Correlation Between Armada Hflr and Guggenheim Limited

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

By analyzing existing cross correlation between Armada Hflr Pr and Guggenheim Limited Duration, you can compare the effects of market volatilities on Armada Hflr and Guggenheim Limited 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 Armada Hflr with a short position of Guggenheim Limited. Check out your portfolio center. Please also check ongoing floating volatility patterns of Armada Hflr and Guggenheim Limited.

Diversification Opportunities for Armada Hflr and Guggenheim Limited

-0.8

Correlation Coefficient

Armada Hflr  Guggenheim Limited

Pay attention - limited upside

The 3 months correlation between Armada and Guggenheim is -0.8. Overlapping area represents the amount of risk that can be diversified away by holding Armada Hflr Pr and Guggenheim Limited Duration in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guggenheim Limited and Armada Hflr 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 Armada Hflr Pr are associated (or correlated) with Guggenheim Limited. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guggenheim Limited has no effect on the direction of Armada Hflr i.e., Armada Hflr and Guggenheim Limited go up and down completely randomly.

Pair Corralation between Armada Hflr and Guggenheim Limited

Considering the 90-day investment horizon Armada Hflr Pr is expected to under-perform the Guggenheim Limited. In addition to that, Armada Hflr is 19.3 times more volatile than Guggenheim Limited Duration. It trades about -0.21 of its total potential returns per unit of risk. Guggenheim Limited Duration is currently generating about 0.24 per unit of volatility. If you would invest  2,416  in Guggenheim Limited Duration on December 29, 2024 and sell it today you would earn a total of  38.00  from holding Guggenheim Limited Duration or generate 1.57% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Significant
Accuracy	100.0%
Values	Daily Returns

Armada Hflr Pr  vs.  Guggenheim Limited Duration

Armada Hflr Pr

Risk-Adjusted Performance

Very Weak

Over the last 90 days Armada Hflr Pr has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Stock's technical indicators remain fairly strong which may send shares a bit higher in April 2025. The recent confusion may also be a sign of long-lasting up-swing for the firm traders.

Guggenheim Limited

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Guggenheim Limited Duration are ranked lower than 18 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong technical indicators, Guggenheim Limited is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Armada Hflr and Guggenheim Limited

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

The idea behind Armada Hflr Pr and Guggenheim Limited Duration 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.

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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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.