Correlation Between IMGP DBi and FolioBeyond Rising

Can any of the company-specific risk be diversified away by investing in both IMGP DBi and FolioBeyond Rising 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 IMGP DBi and FolioBeyond Rising into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between iMGP DBi Managed and FolioBeyond Rising Rates, you can compare the effects of market volatilities on IMGP DBi and FolioBeyond Rising 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 IMGP DBi with a short position of FolioBeyond Rising. Check out your portfolio center. Please also check ongoing floating volatility patterns of IMGP DBi and FolioBeyond Rising.

Diversification Opportunities for IMGP DBi and FolioBeyond Rising

-0.84

Correlation Coefficient

IMGP DBi  FolioBeyond Rising

Pay attention - limited upside

The 3 months correlation between IMGP and FolioBeyond is -0.84. Overlapping area represents the amount of risk that can be diversified away by holding iMGP DBi Managed and FolioBeyond Rising Rates in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FolioBeyond Rising Rates and IMGP DBi 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 iMGP DBi Managed are associated (or correlated) with FolioBeyond Rising. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FolioBeyond Rising Rates has no effect on the direction of IMGP DBi i.e., IMGP DBi and FolioBeyond Rising go up and down completely randomly.

Pair Corralation between IMGP DBi and FolioBeyond Rising

Given the investment horizon of 90 days iMGP DBi Managed is expected to under-perform the FolioBeyond Rising. But the etf apears to be less risky and, when comparing its historical volatility, iMGP DBi Managed is 1.26 times less risky than FolioBeyond Rising. The etf trades about -0.04 of its potential returns per unit of risk. The FolioBeyond Rising Rates is currently generating about 0.23 of returns per unit of risk over similar time horizon. If you would invest  3,314  in FolioBeyond Rising Rates on September 14, 2024 and sell it today you would earn a total of  279.00  from holding FolioBeyond Rising Rates or generate 8.42% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Significant
Accuracy	100.0%
Values	Daily Returns

iMGP DBi Managed  vs.  FolioBeyond Rising Rates

iMGP DBi Managed

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days iMGP DBi Managed has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable primary indicators, IMGP DBi is not utilizing all of its potentials. The recent stock price disturbance, may contribute to mid-run losses for the stockholders.

FolioBeyond Rising Rates

Risk-Adjusted Performance

17 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in FolioBeyond Rising Rates are ranked lower than 17 (%) of all global equities and portfolios over the last 90 days. Even with relatively unsteady basic indicators, FolioBeyond Rising may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Pair Trading with IMGP DBi and FolioBeyond Rising

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

The idea behind iMGP DBi Managed and FolioBeyond Rising Rates 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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.