Correlation Between Invesco Advantage and Pinetree Capital
Can any of the company-specific risk be diversified away by investing in both Invesco Advantage and Pinetree Capital at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Invesco Advantage and Pinetree Capital into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Invesco Advantage MIT and Pinetree Capital, you can compare the effects of market volatilities on Invesco Advantage and Pinetree Capital and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Invesco Advantage with a short position of Pinetree Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of Invesco Advantage and Pinetree Capital.
Diversification Opportunities for Invesco Advantage and Pinetree Capital
0.07 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Invesco and Pinetree is 0.07. Overlapping area represents the amount of risk that can be diversified away by holding Invesco Advantage MIT and Pinetree Capital in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pinetree Capital and Invesco Advantage is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Invesco Advantage MIT are associated (or correlated) with Pinetree Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pinetree Capital has no effect on the direction of Invesco Advantage i.e., Invesco Advantage and Pinetree Capital go up and down completely randomly.
Pair Corralation between Invesco Advantage and Pinetree Capital
Considering the 90-day investment horizon Invesco Advantage is expected to generate 13.4 times less return on investment than Pinetree Capital. But when comparing it to its historical volatility, Invesco Advantage MIT is 7.83 times less risky than Pinetree Capital. It trades about 0.19 of its potential returns per unit of risk. Pinetree Capital is currently generating about 0.33 of returns per unit of risk over similar time horizon. If you would invest 652.00 in Pinetree Capital on September 5, 2024 and sell it today you would earn a total of 258.00 from holding Pinetree Capital or generate 39.57% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 95.45% |
| Values | Daily Returns |
Invesco Advantage MIT vs. Pinetree Capital
Performance |
| Timeline |
| Invesco Advantage MIT |
| Pinetree Capital |
Invesco Advantage and Pinetree Capital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Invesco Advantage and Pinetree Capital
The main advantage of trading using opposite Invesco Advantage and Pinetree Capital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Invesco Advantage position performs unexpectedly, Pinetree Capital can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Pinetree Capital will offset losses from the drop in Pinetree Capital's long position.| Invesco Advantage vs. Invesco Quality Municipal | Invesco Advantage vs. Invesco California Value | Invesco Advantage vs. DWS Municipal Income | Invesco Advantage vs. Invesco Trust For |
| Pinetree Capital vs. Western Asset Global | Pinetree Capital vs. Invesco Trust For | Pinetree Capital vs. Logan Ridge Finance | Pinetree Capital vs. Invesco Advantage MIT |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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