Correlation Between Advent Claymore and Tiaa-cref Lifecycle
Can any of the company-specific risk be diversified away by investing in both Advent Claymore and Tiaa-cref Lifecycle 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 Tiaa-cref Lifecycle 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 Tiaa Cref Lifecycle Index, you can compare the effects of market volatilities on Advent Claymore and Tiaa-cref Lifecycle 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 Tiaa-cref Lifecycle. Check out your portfolio center. Please also check ongoing floating volatility patterns of Advent Claymore and Tiaa-cref Lifecycle.
Diversification Opportunities for Advent Claymore and Tiaa-cref Lifecycle
0.61 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Advent and Tiaa-cref is 0.61. Overlapping area represents the amount of risk that can be diversified away by holding Advent Claymore Convertible and Tiaa Cref Lifecycle Index in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tiaa Cref Lifecycle 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 Tiaa-cref Lifecycle. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tiaa Cref Lifecycle has no effect on the direction of Advent Claymore i.e., Advent Claymore and Tiaa-cref Lifecycle go up and down completely randomly.
Pair Corralation between Advent Claymore and Tiaa-cref Lifecycle
Assuming the 90 days horizon Advent Claymore is expected to generate 1.04 times less return on investment than Tiaa-cref Lifecycle. But when comparing it to its historical volatility, Advent Claymore Convertible is 1.39 times less risky than Tiaa-cref Lifecycle. It trades about 0.14 of its potential returns per unit of risk. Tiaa Cref Lifecycle Index is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest 1,426 in Tiaa Cref Lifecycle Index on October 25, 2024 and sell it today you would earn a total of 20.00 from holding Tiaa Cref Lifecycle Index or generate 1.4% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 94.74% |
| Values | Daily Returns |
Advent Claymore Convertible vs. Tiaa Cref Lifecycle Index
Performance |
| Timeline |
| Advent Claymore Conv |
| Tiaa Cref Lifecycle |
Advent Claymore and Tiaa-cref Lifecycle Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Advent Claymore and Tiaa-cref Lifecycle
The main advantage of trading using opposite Advent Claymore and Tiaa-cref Lifecycle positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Advent Claymore position performs unexpectedly, Tiaa-cref Lifecycle 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 Tiaa-cref Lifecycle will offset losses from the drop in Tiaa-cref Lifecycle's long position.| Advent Claymore vs. Hewitt Money Market | Advent Claymore vs. Schwab Government Money | Advent Claymore vs. Hsbc Treasury Money | Advent Claymore vs. Dws Government Money |
| Tiaa-cref Lifecycle vs. Principal Fds Money | Tiaa-cref Lifecycle vs. Aig Government Money | Tiaa-cref Lifecycle vs. Pioneer Money Market | Tiaa-cref Lifecycle vs. Hsbc Treasury Money |
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.
Other Complementary Tools
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation | |
| Portfolio Optimization Compute new portfolio that will generate highest expected return given your specified tolerance for risk | |
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets | |
| Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas | |
| Volatility Analysis Get historical volatility and risk analysis based on latest market data |