Correlation Between ANT and Retailing Fund

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

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

Diversification Opportunities for ANT and Retailing Fund

-0.33

Correlation Coefficient

ANT  Retailing Fund

Very good diversification

The 3 months correlation between ANT and Retailing is -0.33. Overlapping area represents the amount of risk that can be diversified away by holding ANT and Retailing Fund Class in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Retailing Fund Class 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 Retailing Fund. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Retailing Fund Class has no effect on the direction of ANT i.e., ANT and Retailing Fund go up and down completely randomly.

Pair Corralation between ANT and Retailing Fund

Assuming the 90 days trading horizon ANT is expected to generate 80.15 times more return on investment than Retailing Fund. However, ANT is 80.15 times more volatile than Retailing Fund Class. It trades about 0.12 of its potential returns per unit of risk. Retailing Fund Class is currently generating about 0.07 per unit of risk. If you would invest  933.00  in ANT on October 9, 2024 and sell it today you would lose (786.00) from holding ANT or give up 84.24% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	66.8%
Values	Daily Returns

ANT  vs.  Retailing Fund Class

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.

Retailing Fund Class

Risk-Adjusted Performance

2 of 100

Insignificant

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

Pair Trading with ANT and Retailing Fund

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

The idea behind ANT and Retailing Fund Class 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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .