Correlation Between Advent Claymore and Ffcdax
Can any of the company-specific risk be diversified away by investing in both Advent Claymore and Ffcdax 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 Advent Claymore and Ffcdax into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Advent Claymore Convertible and Ffcdax, you can compare the effects of market volatilities on Advent Claymore and Ffcdax 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 Advent Claymore with a short position of Ffcdax. Check out your portfolio center. Please also check ongoing floating volatility patterns of Advent Claymore and Ffcdax.
Diversification Opportunities for Advent Claymore and Ffcdax
0.38 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Advent and Ffcdax is 0.38. Overlapping area represents the amount of risk that can be diversified away by holding Advent Claymore Convertible and Ffcdax in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ffcdax and Advent Claymore 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 Advent Claymore Convertible are associated (or correlated) with Ffcdax. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ffcdax has no effect on the direction of Advent Claymore i.e., Advent Claymore and Ffcdax go up and down completely randomly.
Pair Corralation between Advent Claymore and Ffcdax
Assuming the 90 days horizon Advent Claymore Convertible is expected to generate 1.94 times more return on investment than Ffcdax. However, Advent Claymore is 1.94 times more volatile than Ffcdax. It trades about 0.19 of its potential returns per unit of risk. Ffcdax is currently generating about 0.08 per unit of risk. If you would invest 1,232 in Advent Claymore Convertible on November 9, 2024 and sell it today you would earn a total of 23.00 from holding Advent Claymore Convertible or generate 1.87% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Advent Claymore Convertible vs. Ffcdax
Performance |
| Timeline |
| Advent Claymore Conv |
| Ffcdax |
Advent Claymore and Ffcdax Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Advent Claymore and Ffcdax
The main advantage of trading using opposite Advent Claymore and Ffcdax positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Advent Claymore position performs unexpectedly, Ffcdax 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 Ffcdax will offset losses from the drop in Ffcdax's long position.| Advent Claymore vs. Legg Mason Global | Advent Claymore vs. Dreyfusstandish Global Fixed | Advent Claymore vs. Ab Global Bond | Advent Claymore vs. Aqr Global Macro |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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