Correlation Between Bear Profund and Small-cap Value
Can any of the company-specific risk be diversified away by investing in both Bear Profund and Small-cap Value 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 Bear Profund and Small-cap Value into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bear Profund Bear and Small Cap Value Profund, you can compare the effects of market volatilities on Bear Profund and Small-cap Value 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 Bear Profund with a short position of Small-cap Value. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bear Profund and Small-cap Value.
Diversification Opportunities for Bear Profund and Small-cap Value
-0.64 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Bear and Small-cap is -0.64. Overlapping area represents the amount of risk that can be diversified away by holding Bear Profund Bear and Small Cap Value Profund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Small Cap Value and Bear Profund 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 Bear Profund Bear are associated (or correlated) with Small-cap Value. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Small Cap Value has no effect on the direction of Bear Profund i.e., Bear Profund and Small-cap Value go up and down completely randomly.
Pair Corralation between Bear Profund and Small-cap Value
Assuming the 90 days horizon Bear Profund Bear is expected to generate 0.85 times more return on investment than Small-cap Value. However, Bear Profund Bear is 1.18 times less risky than Small-cap Value. It trades about 0.09 of its potential returns per unit of risk. Small Cap Value Profund is currently generating about -0.2 per unit of risk. If you would invest 939.00 in Bear Profund Bear on December 5, 2024 and sell it today you would earn a total of 44.00 from holding Bear Profund Bear or generate 4.69% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Bear Profund Bear vs. Small Cap Value Profund
Performance |
Timeline |
Bear Profund Bear |
Small Cap Value |
Bear Profund and Small-cap Value Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Bear Profund and Small-cap Value
The main advantage of trading using opposite Bear Profund and Small-cap Value positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bear Profund position performs unexpectedly, Small-cap Value 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 Small-cap Value will offset losses from the drop in Small-cap Value's long position.Bear Profund vs. Barings Emerging Markets | Bear Profund vs. Legg Mason Western | Bear Profund vs. Angel Oak Ultrashort | Bear Profund vs. Maryland Short Term Tax Free |
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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 Portfolio Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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