Correlation Between ANT and Invesco Growth

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

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

Diversification Opportunities for ANT and Invesco Growth

-0.01

Correlation Coefficient

ANT  Invesco Growth

Good diversification

The 3 months correlation between ANT and INVESCO is -0.01. Overlapping area represents the amount of risk that can be diversified away by holding ANT and Invesco Growth Allocation in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Invesco Growth Allocation and ANT 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 ANT are associated (or correlated) with Invesco Growth. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Invesco Growth Allocation has no effect on the direction of ANT i.e., ANT and Invesco Growth go up and down completely randomly.

Pair Corralation between ANT and Invesco Growth

Assuming the 90 days trading horizon ANT is expected to generate 81.21 times more return on investment than Invesco Growth. However, ANT is 81.21 times more volatile than Invesco Growth Allocation. It trades about 0.14 of its potential returns per unit of risk. Invesco Growth Allocation is currently generating about 0.03 per unit of risk. If you would invest  1,048  in ANT on October 25, 2024 and sell it today you would lose (901.00) from holding ANT or give up 85.97% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	95.24%
Values	Daily Returns

ANT  vs.  Invesco Growth Allocation

ANT

Risk-Adjusted Performance

10 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in ANT are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. In spite of rather unsteady basic indicators, ANT exhibited solid returns over the last few months and may actually be approaching a breakup point.

Invesco Growth Allocation

Risk-Adjusted Performance

2 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Invesco Growth Allocation are ranked lower than 2 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong basic indicators, Invesco Growth is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with ANT and Invesco Growth

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

The idea behind ANT and Invesco Growth Allocation 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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.