Correlation Between Investec Global and Brandes E
Can any of the company-specific risk be diversified away by investing in both Investec Global and Brandes E 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 Investec Global and Brandes E into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Investec Global Franchise and Brandes E Plus, you can compare the effects of market volatilities on Investec Global and Brandes E 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 Investec Global with a short position of Brandes E. Check out your portfolio center. Please also check ongoing floating volatility patterns of Investec Global and Brandes E.
Diversification Opportunities for Investec Global and Brandes E
-0.21 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Investec and Brandes is -0.21. Overlapping area represents the amount of risk that can be diversified away by holding Investec Global Franchise and Brandes E Plus in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Brandes E Plus and Investec Global 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 Investec Global Franchise are associated (or correlated) with Brandes E. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Brandes E Plus has no effect on the direction of Investec Global i.e., Investec Global and Brandes E go up and down completely randomly.
Pair Corralation between Investec Global and Brandes E
Assuming the 90 days horizon Investec Global Franchise is expected to generate 2.03 times more return on investment than Brandes E. However, Investec Global is 2.03 times more volatile than Brandes E Plus. It trades about 0.06 of its potential returns per unit of risk. Brandes E Plus is currently generating about 0.06 per unit of risk. If you would invest 1,561 in Investec Global Franchise on September 12, 2024 and sell it today you would earn a total of 244.00 from holding Investec Global Franchise or generate 15.63% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Investec Global Franchise vs. Brandes E Plus
Performance |
| Timeline |
| Investec Global Franchise |
| Brandes E Plus |
Investec Global and Brandes E Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Investec Global and Brandes E
The main advantage of trading using opposite Investec Global and Brandes E positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Investec Global position performs unexpectedly, Brandes E 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 Brandes E will offset losses from the drop in Brandes E's long position.| Investec Global vs. Pace Smallmedium Value | Investec Global vs. Kinetics Small Cap | Investec Global vs. Touchstone Small Cap | Investec Global vs. Ab Small Cap |
| Brandes E vs. Barings Global Floating | Brandes E vs. Ab Global Risk | Brandes E vs. Investec Global Franchise | Brandes E vs. Ab Global Bond |
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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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