Correlation Between Advent Claymore and Victory High
Can any of the company-specific risk be diversified away by investing in both Advent Claymore and Victory High 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 Victory High 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 Victory High Yield, you can compare the effects of market volatilities on Advent Claymore and Victory High 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 Victory High. Check out your portfolio center. Please also check ongoing floating volatility patterns of Advent Claymore and Victory High.
Diversification Opportunities for Advent Claymore and Victory High
0.22 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Advent and Victory is 0.22. Overlapping area represents the amount of risk that can be diversified away by holding Advent Claymore Convertible and Victory High Yield in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Victory High Yield 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 Victory High. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Victory High Yield has no effect on the direction of Advent Claymore i.e., Advent Claymore and Victory High go up and down completely randomly.
Pair Corralation between Advent Claymore and Victory High
Assuming the 90 days horizon Advent Claymore is expected to generate 14.84 times less return on investment than Victory High. In addition to that, Advent Claymore is 2.39 times more volatile than Victory High Yield. It trades about 0.0 of its total potential returns per unit of risk. Victory High Yield is currently generating about 0.13 per unit of volatility. If you would invest 459.00 in Victory High Yield on December 12, 2024 and sell it today you would earn a total of 91.00 from holding Victory High Yield or generate 19.83% 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. Victory High Yield
Performance |
| Timeline |
| Advent Claymore Conv |
| Victory High Yield |
Advent Claymore and Victory High Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Advent Claymore and Victory High
The main advantage of trading using opposite Advent Claymore and Victory High positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Advent Claymore position performs unexpectedly, Victory High 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 Victory High will offset losses from the drop in Victory High's long position.| Advent Claymore vs. City National Rochdale | ||
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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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