Correlation Between Advent Claymore and Short Oil
Can any of the company-specific risk be diversified away by investing in both Advent Claymore and Short Oil 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 Advent Claymore and Short Oil into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Advent Claymore Convertible and Short Oil Gas, you can compare the effects of market volatilities on Advent Claymore and Short Oil 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 Advent Claymore with a short position of Short Oil. Check out your portfolio center. Please also check ongoing floating volatility patterns of Advent Claymore and Short Oil.
Diversification Opportunities for Advent Claymore and Short Oil
-0.54 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Advent and Short is -0.54. Overlapping area represents the amount of risk that can be diversified away by holding Advent Claymore Convertible and Short Oil Gas in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Short Oil Gas and Advent Claymore 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 Advent Claymore Convertible are associated (or correlated) with Short Oil. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Short Oil Gas has no effect on the direction of Advent Claymore i.e., Advent Claymore and Short Oil go up and down completely randomly.
Pair Corralation between Advent Claymore and Short Oil
Considering the 90-day investment horizon Advent Claymore Convertible is expected to under-perform the Short Oil. But the fund apears to be less risky and, when comparing its historical volatility, Advent Claymore Convertible is 2.19 times less risky than Short Oil. The fund trades about -0.22 of its potential returns per unit of risk. The Short Oil Gas is currently generating about 0.16 of returns per unit of risk over similar time horizon. If you would invest 1,379 in Short Oil Gas on December 6, 2024 and sell it today you would earn a total of 66.00 from holding Short Oil Gas or generate 4.79% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Very Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Advent Claymore Convertible vs. Short Oil Gas
Performance |
Timeline |
Advent Claymore Conv |
Short Oil Gas |
Advent Claymore and Short Oil Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Advent Claymore and Short Oil
The main advantage of trading using opposite Advent Claymore and Short Oil positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Advent Claymore position performs unexpectedly, Short Oil 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 Short Oil will offset losses from the drop in Short Oil's long position.Advent Claymore vs. Nuveen Global High | Advent Claymore vs. Blackstone Gso Strategic | Advent Claymore vs. Thornburg Income Builder | Advent Claymore vs. Western Asset Diversified |
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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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
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