Correlation Between ANT and Invesco BulletShares

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

By analyzing existing cross correlation between ANT and Invesco BulletShares 2028, you can compare the effects of market volatilities on ANT and Invesco BulletShares 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 BulletShares. Check out your portfolio center. Please also check ongoing floating volatility patterns of ANT and Invesco BulletShares.

Diversification Opportunities for ANT and Invesco BulletShares

-0.4

Correlation Coefficient

ANT  Invesco BulletShares

Very good diversification

The 3 months correlation between ANT and Invesco is -0.4. Overlapping area represents the amount of risk that can be diversified away by holding ANT and Invesco BulletShares 2028 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Invesco BulletShares 2028 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 BulletShares. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Invesco BulletShares 2028 has no effect on the direction of ANT i.e., ANT and Invesco BulletShares go up and down completely randomly.

Pair Corralation between ANT and Invesco BulletShares

Assuming the 90 days trading horizon ANT is expected to generate 152.81 times more return on investment than Invesco BulletShares. However, ANT is 152.81 times more volatile than Invesco BulletShares 2028. It trades about 0.1 of its potential returns per unit of risk. Invesco BulletShares 2028 is currently generating about 0.09 per unit of risk. If you would invest  298.00  in ANT on October 11, 2024 and sell it today you would lose (151.00) from holding ANT or give up 50.67% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	60.0%
Values	Daily Returns

ANT  vs.  Invesco BulletShares 2028

ANT

Risk-Adjusted Performance

16 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in ANT are ranked lower than 16 (%) 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 BulletShares 2028

Risk-Adjusted Performance

4 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Invesco BulletShares 2028 are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively stable forward-looking indicators, Invesco BulletShares is not utilizing all of its potentials. The latest stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with ANT and Invesco BulletShares

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

The idea behind ANT and Invesco BulletShares 2028 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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.