Correlation Between Causeway International and Hewitt Money

Can any of the company-specific risk be diversified away by investing in both Causeway International and Hewitt Money 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 Causeway International and Hewitt Money into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Causeway International Opportunities and Hewitt Money Market, you can compare the effects of market volatilities on Causeway International and Hewitt Money 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 Causeway International with a short position of Hewitt Money. Check out your portfolio center. Please also check ongoing floating volatility patterns of Causeway International and Hewitt Money.

Diversification Opportunities for Causeway International and Hewitt Money

0.0

Correlation Coefficient

Causeway International  Hewitt Money

Pay attention - limited upside

The 3 months correlation between Causeway and Hewitt is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Causeway International Opportu and Hewitt Money Market in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hewitt Money Market and Causeway 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 Causeway International Opportunities are associated (or correlated) with Hewitt Money. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hewitt Money Market has no effect on the direction of Causeway International i.e., Causeway International and Hewitt Money go up and down completely randomly.

Pair Corralation between Causeway International and Hewitt Money

If you would invest  100.00  in Hewitt Money Market on October 10, 2024 and sell it today you would earn a total of  0.00  from holding Hewitt Money Market or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Causeway International Opportu  vs.  Hewitt Money Market

Causeway International

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Causeway International Opportunities has generated negative risk-adjusted returns adding no value to fund investors. In spite of weak performance in the last few months, the Fund's forward indicators remain fairly strong which may send shares a bit higher in February 2025. The current disturbance may also be a sign of long term up-swing for the fund investors.

Hewitt Money Market

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Hewitt Money Market has generated negative risk-adjusted returns adding no value to fund investors. In spite of fairly strong basic indicators, Hewitt Money is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Causeway International and Hewitt Money

The main advantage of trading using opposite Causeway International and Hewitt Money positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Causeway International position performs unexpectedly, Hewitt Money 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 Hewitt Money will offset losses from the drop in Hewitt Money's long position.

The idea behind Causeway International Opportunities and Hewitt Money Market pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.