Correlation Between Arbitrage Event and Cullen High
Can any of the company-specific risk be diversified away by investing in both Arbitrage Event and Cullen 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 Arbitrage Event and Cullen High into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between The Arbitrage Event Driven and Cullen High Dividend, you can compare the effects of market volatilities on Arbitrage Event and Cullen 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 Arbitrage Event with a short position of Cullen High. Check out your portfolio center. Please also check ongoing floating volatility patterns of Arbitrage Event and Cullen High.
Diversification Opportunities for Arbitrage Event and Cullen High
0.49 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Arbitrage and Cullen is 0.49. Overlapping area represents the amount of risk that can be diversified away by holding The Arbitrage Event Driven and Cullen High Dividend in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cullen High Dividend and Arbitrage Event 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 The Arbitrage Event Driven are associated (or correlated) with Cullen High. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cullen High Dividend has no effect on the direction of Arbitrage Event i.e., Arbitrage Event and Cullen High go up and down completely randomly.
Pair Corralation between Arbitrage Event and Cullen High
Assuming the 90 days horizon Arbitrage Event is expected to generate 1.87 times less return on investment than Cullen High. But when comparing it to its historical volatility, The Arbitrage Event Driven is 2.89 times less risky than Cullen High. It trades about 0.06 of its potential returns per unit of risk. Cullen High Dividend is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 1,332 in Cullen High Dividend on September 7, 2024 and sell it today you would earn a total of 178.00 from holding Cullen High Dividend or generate 13.36% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Weak |
Accuracy | 100.0% |
Values | Daily Returns |
The Arbitrage Event Driven vs. Cullen High Dividend
Performance |
Timeline |
Arbitrage Event |
Cullen High Dividend |
Arbitrage Event and Cullen High Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Arbitrage Event and Cullen High
The main advantage of trading using opposite Arbitrage Event and Cullen High positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Arbitrage Event position performs unexpectedly, Cullen 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 Cullen High will offset losses from the drop in Cullen High's long position.Arbitrage Event vs. Aqr Diversified Arbitrage | Arbitrage Event vs. Baron Emerging Markets | Arbitrage Event vs. The Arbitrage Fund | Arbitrage Event vs. Brandes Emerging Markets |
Cullen High vs. The Value Fund | Cullen High vs. Lazard Global Listed | Cullen High vs. Lazard International Strategic | Cullen High vs. Tcw Relative Value |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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