Correlation Between Avantis International and Avantis All
Can any of the company-specific risk be diversified away by investing in both Avantis International and Avantis All 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 Avantis International and Avantis All into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Avantis International Small and Avantis All Equity, you can compare the effects of market volatilities on Avantis International and Avantis All 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 Avantis International with a short position of Avantis All. Check out your portfolio center. Please also check ongoing floating volatility patterns of Avantis International and Avantis All.
Diversification Opportunities for Avantis International and Avantis All
-0.08 | Correlation Coefficient |
Good diversification
The 3 months correlation between Avantis and Avantis is -0.08. Overlapping area represents the amount of risk that can be diversified away by holding Avantis International Small and Avantis All Equity in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Avantis All Equity and Avantis International 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 Avantis International Small are associated (or correlated) with Avantis All. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Avantis All Equity has no effect on the direction of Avantis International i.e., Avantis International and Avantis All go up and down completely randomly.
Pair Corralation between Avantis International and Avantis All
Given the investment horizon of 90 days Avantis International is expected to generate 39.35 times less return on investment than Avantis All. In addition to that, Avantis International is 1.19 times more volatile than Avantis All Equity. It trades about 0.0 of its total potential returns per unit of risk. Avantis All Equity is currently generating about 0.18 per unit of volatility. If you would invest 7,092 in Avantis All Equity on September 2, 2024 and sell it today you would earn a total of 564.00 from holding Avantis All Equity or generate 7.95% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
Avantis International Small vs. Avantis All Equity
Performance |
Timeline |
Avantis International |
Avantis All Equity |
Avantis International and Avantis All Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Avantis International and Avantis All
The main advantage of trading using opposite Avantis International and Avantis All positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Avantis International position performs unexpectedly, Avantis All 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 Avantis All will offset losses from the drop in Avantis All's long position.Avantis International vs. Avantis Small Cap | Avantis International vs. Avantis Emerging Markets | Avantis International vs. Avantis International Equity | Avantis International vs. Avantis Equity ETF |
Avantis All vs. Avantis Small Cap | Avantis All vs. Avantis International Small | Avantis All vs. Avantis Equity ETF | Avantis All vs. Avantis Emerging Markets |
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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
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