Correlation Between Vanguard Total and Aptus Defined
Can any of the company-specific risk be diversified away by investing in both Vanguard Total and Aptus Defined 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 Vanguard Total and Aptus Defined into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Vanguard Total Bond and Aptus Defined Risk, you can compare the effects of market volatilities on Vanguard Total and Aptus Defined 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 Vanguard Total with a short position of Aptus Defined. Check out your portfolio center. Please also check ongoing floating volatility patterns of Vanguard Total and Aptus Defined.
Diversification Opportunities for Vanguard Total and Aptus Defined
0.7 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Vanguard and Aptus is 0.7. Overlapping area represents the amount of risk that can be diversified away by holding Vanguard Total Bond and Aptus Defined Risk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aptus Defined Risk and Vanguard Total 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 Vanguard Total Bond are associated (or correlated) with Aptus Defined. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aptus Defined Risk has no effect on the direction of Vanguard Total i.e., Vanguard Total and Aptus Defined go up and down completely randomly.
Pair Corralation between Vanguard Total and Aptus Defined
Considering the 90-day investment horizon Vanguard Total Bond is expected to generate 0.71 times more return on investment than Aptus Defined. However, Vanguard Total Bond is 1.42 times less risky than Aptus Defined. It trades about 0.3 of its potential returns per unit of risk. Aptus Defined Risk is currently generating about 0.16 per unit of risk. If you would invest 7,196 in Vanguard Total Bond on December 5, 2024 and sell it today you would earn a total of 144.00 from holding Vanguard Total Bond or generate 2.0% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Significant |
Accuracy | 100.0% |
Values | Daily Returns |
Vanguard Total Bond vs. Aptus Defined Risk
Performance |
Timeline |
Vanguard Total Bond |
Aptus Defined Risk |
Vanguard Total and Aptus Defined Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Vanguard Total and Aptus Defined
The main advantage of trading using opposite Vanguard Total and Aptus Defined positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Vanguard Total position performs unexpectedly, Aptus Defined 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 Aptus Defined will offset losses from the drop in Aptus Defined's long position.Vanguard Total vs. Vanguard Total International | Vanguard Total vs. Vanguard Total International | Vanguard Total vs. Vanguard Total Stock | Vanguard Total vs. Vanguard Real Estate |
Aptus Defined vs. Amplify BlackSwan Growth | Aptus Defined vs. Aptus Collared Income | Aptus Defined vs. Aptus Drawdown Managed | Aptus Defined vs. Cambria Tail Risk |
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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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