Correlation Between Vanguard Short-term and Astor Long/short
Can any of the company-specific risk be diversified away by investing in both Vanguard Short-term and Astor Long/short 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 Vanguard Short-term and Astor Long/short into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Vanguard Short Term Federal and Astor Longshort Fund, you can compare the effects of market volatilities on Vanguard Short-term and Astor Long/short 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 Vanguard Short-term with a short position of Astor Long/short. Check out your portfolio center. Please also check ongoing floating volatility patterns of Vanguard Short-term and Astor Long/short.
Diversification Opportunities for Vanguard Short-term and Astor Long/short
-0.56 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between VANGUARD and Astor is -0.56. Overlapping area represents the amount of risk that can be diversified away by holding Vanguard Short Term Federal and Astor Longshort Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Astor Long/short and Vanguard Short-term 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 Vanguard Short Term Federal are associated (or correlated) with Astor Long/short. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Astor Long/short has no effect on the direction of Vanguard Short-term i.e., Vanguard Short-term and Astor Long/short go up and down completely randomly.
Pair Corralation between Vanguard Short-term and Astor Long/short
Assuming the 90 days horizon Vanguard Short-term is expected to generate 13.08 times less return on investment than Astor Long/short. But when comparing it to its historical volatility, Vanguard Short Term Federal is 3.06 times less risky than Astor Long/short. It trades about 0.06 of its potential returns per unit of risk. Astor Longshort Fund is currently generating about 0.27 of returns per unit of risk over similar time horizon. If you would invest 1,392 in Astor Longshort Fund on August 29, 2024 and sell it today you would earn a total of 35.00 from holding Astor Longshort Fund or generate 2.51% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
Vanguard Short Term Federal vs. Astor Longshort Fund
Performance |
| Timeline |
| Vanguard Short Term |
| Astor Long/short |
Vanguard Short-term and Astor Long/short Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Vanguard Short-term and Astor Long/short
The main advantage of trading using opposite Vanguard Short-term and Astor Long/short positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Vanguard Short-term position performs unexpectedly, Astor Long/short 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 Astor Long/short will offset losses from the drop in Astor Long/short's long position.| Vanguard Short-term vs. Vanguard Short Term Tax Exempt | Vanguard Short-term vs. HUMANA INC | Vanguard Short-term vs. Aquagold International | Vanguard Short-term vs. Barloworld Ltd ADR |
| Astor Long/short vs. Ambrus Core Bond | Astor Long/short vs. Ms Global Fixed | Astor Long/short vs. T Rowe Price | Astor Long/short vs. Multisector Bond Sma |
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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
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