Correlation Between Invesco High and CBH
Can any of the company-specific risk be diversified away by investing in both Invesco High and CBH 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 High and CBH into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Invesco High Income and CBH, you can compare the effects of market volatilities on Invesco High and CBH 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 High with a short position of CBH. Check out your portfolio center. Please also check ongoing floating volatility patterns of Invesco High and CBH.
Diversification Opportunities for Invesco High and CBH
0.5 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Invesco and CBH is 0.5. Overlapping area represents the amount of risk that can be diversified away by holding Invesco High Income and CBH in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CBH and Invesco High 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 High Income are associated (or correlated) with CBH. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CBH has no effect on the direction of Invesco High i.e., Invesco High and CBH go up and down completely randomly.
Pair Corralation between Invesco High and CBH
Considering the 90-day investment horizon Invesco High Income is expected to generate 1.11 times more return on investment than CBH. However, Invesco High is 1.11 times more volatile than CBH. It trades about 0.13 of its potential returns per unit of risk. CBH is currently generating about 0.08 per unit of risk. If you would invest 875.00 in Invesco High Income on August 31, 2024 and sell it today you would earn a total of 263.00 from holding Invesco High Income or generate 30.06% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 83.16% |
| Values | Daily Returns |
Invesco High Income vs. CBH
Performance |
| Timeline |
| Invesco High Income |
| CBH |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Invesco High and CBH Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Invesco High and CBH
The main advantage of trading using opposite Invesco High and CBH positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Invesco High position performs unexpectedly, CBH 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 CBH will offset losses from the drop in CBH's long position.| Invesco High vs. Pioneer Floating Rate | Invesco High vs. Franklin Templeton Limited | Invesco High vs. Western Asset Global | Invesco High vs. Brandywineglobal Globalome Opportunities |
| CBH vs. Eaton Vance National | CBH vs. Invesco High Income | CBH vs. Blackrock Muniholdings Ny | CBH vs. Nuveen California Select |
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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
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