Correlation Between Wasatch Hoisington and Inflation-adjusted
Can any of the company-specific risk be diversified away by investing in both Wasatch Hoisington and Inflation-adjusted 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 Wasatch Hoisington and Inflation-adjusted into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Wasatch Hoisington Treasury Fund and Inflation Adjusted Bond Fund, you can compare the effects of market volatilities on Wasatch Hoisington and Inflation-adjusted 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 Wasatch Hoisington with a short position of Inflation-adjusted. Check out your portfolio center. Please also check ongoing floating volatility patterns of Wasatch Hoisington and Inflation-adjusted.
Diversification Opportunities for Wasatch Hoisington and Inflation-adjusted
0.83 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Wasatch and Inflation-adjusted is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding Wasatch Hoisington Treasury Fu and Inflation Adjusted Bond Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Inflation Adjusted Bond and Wasatch Hoisington 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 Wasatch Hoisington Treasury Fund are associated (or correlated) with Inflation-adjusted. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Inflation Adjusted Bond has no effect on the direction of Wasatch Hoisington i.e., Wasatch Hoisington and Inflation-adjusted go up and down completely randomly.
Pair Corralation between Wasatch Hoisington and Inflation-adjusted
Assuming the 90 days horizon Wasatch Hoisington Treasury Fund is expected to generate 5.12 times more return on investment than Inflation-adjusted. However, Wasatch Hoisington is 5.12 times more volatile than Inflation Adjusted Bond Fund. It trades about 0.1 of its potential returns per unit of risk. Inflation Adjusted Bond Fund is currently generating about 0.14 per unit of risk. If you would invest 1,103 in Wasatch Hoisington Treasury Fund on September 4, 2024 and sell it today you would earn a total of 31.00 from holding Wasatch Hoisington Treasury Fund or generate 2.81% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 95.24% |
| Values | Daily Returns |
Wasatch Hoisington Treasury Fu vs. Inflation Adjusted Bond Fund
Performance |
| Timeline |
| Wasatch Hoisington |
| Inflation Adjusted Bond |
Wasatch Hoisington and Inflation-adjusted Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Wasatch Hoisington and Inflation-adjusted
The main advantage of trading using opposite Wasatch Hoisington and Inflation-adjusted positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Wasatch Hoisington position performs unexpectedly, Inflation-adjusted 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 Inflation-adjusted will offset losses from the drop in Inflation-adjusted's long position.| Wasatch Hoisington vs. Zero Pon 2025 | Wasatch Hoisington vs. Wasatch World Innovators | Wasatch Hoisington vs. Wasatch Small Cap | Wasatch Hoisington vs. Wasatch International Growth |
| Inflation-adjusted vs. Mid Cap Value | Inflation-adjusted vs. Equity Growth Fund | Inflation-adjusted vs. Income Growth Fund | Inflation-adjusted vs. Diversified Bond Fund |
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 Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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