Correlation Between ANT and ETF Series

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

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

Diversification Opportunities for ANT and ETF Series

0.14

Correlation Coefficient

ANT  ETF Series

Average diversification

The 3 months correlation between ANT and ETF is 0.14. Overlapping area represents the amount of risk that can be diversified away by holding ANT and ETF Series Solutions in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ETF Series Solutions 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 ETF Series. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ETF Series Solutions has no effect on the direction of ANT i.e., ANT and ETF Series go up and down completely randomly.

Pair Corralation between ANT and ETF Series

Assuming the 90 days trading horizon ANT is expected to generate 18.27 times more return on investment than ETF Series. However, ANT is 18.27 times more volatile than ETF Series Solutions. It trades about 0.09 of its potential returns per unit of risk. ETF Series Solutions is currently generating about 0.52 per unit of risk. If you would invest  147.00  in ANT on October 25, 2024 and sell it today you would earn a total of  0.00  from holding ANT or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	76.19%
Values	Daily Returns

ANT  vs.  ETF Series Solutions

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.

ETF Series Solutions

Risk-Adjusted Performance

40 of 100

Very Strong

Compared to the overall equity markets, risk-adjusted returns on investments in ETF Series Solutions are ranked lower than 40 (%) of all global equities and portfolios over the last 90 days. Even with relatively inconsistent basic indicators, ETF Series reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with ANT and ETF Series

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

The idea behind ANT and ETF Series Solutions 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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.