Correlation Between Kensington Defender and Crossmark Steward
Can any of the company-specific risk be diversified away by investing in both Kensington Defender and Crossmark Steward 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 Kensington Defender and Crossmark Steward into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kensington Defender Institutional and Crossmark Steward Equity, you can compare the effects of market volatilities on Kensington Defender and Crossmark Steward 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 Kensington Defender with a short position of Crossmark Steward. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kensington Defender and Crossmark Steward.
Diversification Opportunities for Kensington Defender and Crossmark Steward
0.05 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Kensington and Crossmark is 0.05. Overlapping area represents the amount of risk that can be diversified away by holding Kensington Defender Institutio and Crossmark Steward Equity in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Crossmark Steward Equity and Kensington Defender 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 Kensington Defender Institutional are associated (or correlated) with Crossmark Steward. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Crossmark Steward Equity has no effect on the direction of Kensington Defender i.e., Kensington Defender and Crossmark Steward go up and down completely randomly.
Pair Corralation between Kensington Defender and Crossmark Steward
Assuming the 90 days horizon Kensington Defender Institutional is expected to generate 0.71 times more return on investment than Crossmark Steward. However, Kensington Defender Institutional is 1.4 times less risky than Crossmark Steward. It trades about -0.16 of its potential returns per unit of risk. Crossmark Steward Equity is currently generating about -0.21 per unit of risk. If you would invest 1,064 in Kensington Defender Institutional on September 23, 2024 and sell it today you would lose (23.00) from holding Kensington Defender Institutional or give up 2.16% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
Kensington Defender Institutio vs. Crossmark Steward Equity
Performance |
Timeline |
Kensington Defender |
Crossmark Steward Equity |
Kensington Defender and Crossmark Steward Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Kensington Defender and Crossmark Steward
The main advantage of trading using opposite Kensington Defender and Crossmark Steward positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kensington Defender position performs unexpectedly, Crossmark Steward 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 Crossmark Steward will offset losses from the drop in Crossmark Steward's long position.Kensington Defender vs. Elfun Government Money | Kensington Defender vs. Ridgeworth Seix Government | Kensington Defender vs. Sit Government Securities | Kensington Defender vs. Dws Government Money |
Crossmark Steward vs. Ep Emerging Markets | Crossmark Steward vs. Extended Market Index | Crossmark Steward vs. Barings Emerging Markets | Crossmark Steward vs. Origin Emerging Markets |
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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
Other Complementary Tools
Competition Analyzer Analyze and compare many basic indicators for a group of related or unrelated entities | |
Portfolio Optimization Compute new portfolio that will generate highest expected return given your specified tolerance for risk | |
Price Ceiling Movement Calculate and plot Price Ceiling Movement for different equity instruments | |
Bond Analysis Evaluate and analyze corporate bonds as a potential investment for your portfolios. | |
Portfolio Comparator Compare the composition, asset allocations and performance of any two portfolios in your account |