Correlation Between Astor Long/short and Pioneer Global

Can any of the company-specific risk be diversified away by investing in both Astor Long/short and Pioneer Global 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 Astor Long/short and Pioneer Global into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Astor Longshort Fund and Pioneer Global Equity, you can compare the effects of market volatilities on Astor Long/short and Pioneer Global 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 Astor Long/short with a short position of Pioneer Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of Astor Long/short and Pioneer Global.

Diversification Opportunities for Astor Long/short and Pioneer Global

0.52

Correlation Coefficient

Astor Long/short  Pioneer Global

Very weak diversification

The 3 months correlation between Astor and Pioneer is 0.52. Overlapping area represents the amount of risk that can be diversified away by holding Astor Longshort Fund and Pioneer Global Equity in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pioneer Global Equity and Astor Long/short 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 Astor Longshort Fund are associated (or correlated) with Pioneer Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pioneer Global Equity has no effect on the direction of Astor Long/short i.e., Astor Long/short and Pioneer Global go up and down completely randomly.

Pair Corralation between Astor Long/short and Pioneer Global

Assuming the 90 days horizon Astor Long/short is expected to generate 2.27 times less return on investment than Pioneer Global. But when comparing it to its historical volatility, Astor Longshort Fund is 1.22 times less risky than Pioneer Global. It trades about 0.01 of its potential returns per unit of risk. Pioneer Global Equity is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest  1,740  in Pioneer Global Equity on October 7, 2024 and sell it today you would earn a total of  83.00  from holding Pioneer Global Equity or generate 4.77% return on investment over 90 days.

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

Astor Longshort Fund  vs.  Pioneer Global Equity

Astor Long/short

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Astor Longshort Fund has generated negative risk-adjusted returns adding no value to fund investors. In spite of latest weak performance, the Fund's forward indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the fund investors.

Pioneer Global Equity

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Pioneer Global Equity has generated negative risk-adjusted returns adding no value to fund investors. In spite of latest weak performance, the Fund's technical and fundamental indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the fund investors.

Pair Trading with Astor Long/short and Pioneer Global

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

The idea behind Astor Longshort Fund and Pioneer Global Equity 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.