Correlation Between Acadian Emerging and Acadian Emerging

Can any of the company-specific risk be diversified away by investing in both Acadian Emerging and Acadian Emerging 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 Acadian Emerging and Acadian Emerging into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Acadian Emerging Markets and Acadian Emerging Markets, you can compare the effects of market volatilities on Acadian Emerging and Acadian Emerging 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 Acadian Emerging with a short position of Acadian Emerging. Check out your portfolio center. Please also check ongoing floating volatility patterns of Acadian Emerging and Acadian Emerging.

Diversification Opportunities for Acadian Emerging and Acadian Emerging

1.0

Correlation Coefficient

Acadian Emerging  Acadian Emerging

No risk reduction

The 3 months correlation between Acadian and Acadian is 1.0. Overlapping area represents the amount of risk that can be diversified away by holding Acadian Emerging Markets and Acadian Emerging Markets in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Acadian Emerging Markets and Acadian Emerging 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 Acadian Emerging Markets are associated (or correlated) with Acadian Emerging. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Acadian Emerging Markets has no effect on the direction of Acadian Emerging i.e., Acadian Emerging and Acadian Emerging go up and down completely randomly.

Pair Corralation between Acadian Emerging and Acadian Emerging

Assuming the 90 days horizon Acadian Emerging Markets is expected to under-perform the Acadian Emerging. But the mutual fund apears to be less risky and, when comparing its historical volatility, Acadian Emerging Markets is 1.01 times less risky than Acadian Emerging. The mutual fund trades about -0.08 of its potential returns per unit of risk. The Acadian Emerging Markets is currently generating about -0.07 of returns per unit of risk over similar time horizon. If you would invest  2,273  in Acadian Emerging Markets on October 22, 2024 and sell it today you would lose (25.00) from holding Acadian Emerging Markets or give up 1.1% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Strong
Accuracy	100.0%
Values	Daily Returns

Acadian Emerging Markets  vs.  Acadian Emerging Markets

Acadian Emerging Markets

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Acadian Emerging Markets has generated negative risk-adjusted returns adding no value to fund investors. In spite of fairly strong technical and fundamental indicators, Acadian Emerging is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Acadian Emerging Markets

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Acadian Emerging Markets has generated negative risk-adjusted returns adding no value to fund investors. In spite of fairly strong basic indicators, Acadian Emerging is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Acadian Emerging and Acadian Emerging

The main advantage of trading using opposite Acadian Emerging and Acadian Emerging positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Acadian Emerging position performs unexpectedly, Acadian Emerging 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 Acadian Emerging will offset losses from the drop in Acadian Emerging's long position.

The idea behind Acadian Emerging Markets and Acadian Emerging Markets pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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 Center module to all portfolio management and optimization tools to improve performance of your portfolios.