Correlation Between Advent Claymore and Undiscovered Managers
Can any of the company-specific risk be diversified away by investing in both Advent Claymore and Undiscovered Managers 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 Undiscovered Managers 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 Undiscovered Managers Behavioral, you can compare the effects of market volatilities on Advent Claymore and Undiscovered Managers 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 Undiscovered Managers. Check out your portfolio center. Please also check ongoing floating volatility patterns of Advent Claymore and Undiscovered Managers.
Diversification Opportunities for Advent Claymore and Undiscovered Managers
0.47 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Advent and UNDISCOVERED is 0.47. Overlapping area represents the amount of risk that can be diversified away by holding Advent Claymore Convertible and Undiscovered Managers Behavior in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Undiscovered Managers 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 Undiscovered Managers. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Undiscovered Managers has no effect on the direction of Advent Claymore i.e., Advent Claymore and Undiscovered Managers go up and down completely randomly.
Pair Corralation between Advent Claymore and Undiscovered Managers
Considering the 90-day investment horizon Advent Claymore Convertible is expected to generate 0.81 times more return on investment than Undiscovered Managers. However, Advent Claymore Convertible is 1.24 times less risky than Undiscovered Managers. It trades about -0.01 of its potential returns per unit of risk. Undiscovered Managers Behavioral is currently generating about -0.19 per unit of risk. If you would invest 1,195 in Advent Claymore Convertible on December 3, 2024 and sell it today you would lose (7.00) from holding Advent Claymore Convertible or give up 0.59% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Advent Claymore Convertible vs. Undiscovered Managers Behavior
Performance |
Timeline |
Advent Claymore Conv |
Undiscovered Managers |
Advent Claymore and Undiscovered Managers Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Advent Claymore and Undiscovered Managers
The main advantage of trading using opposite Advent Claymore and Undiscovered Managers positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Advent Claymore position performs unexpectedly, Undiscovered Managers 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 Undiscovered Managers will offset losses from the drop in Undiscovered Managers' 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 |
Undiscovered Managers vs. Principal Lifetime Hybrid | Undiscovered Managers vs. Washington Mutual Investors | Undiscovered Managers vs. Enhanced Large Pany | Undiscovered Managers vs. Growth Allocation Fund |
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 Correlations module to find global opportunities by holding instruments from different markets.
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