Correlation Between Stone Harbor and Rivernorth Opportunities

Can any of the company-specific risk be diversified away by investing in both Stone Harbor and Rivernorth Opportunities 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 Stone Harbor and Rivernorth Opportunities into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Stone Harbor Emerging and Rivernorth Opportunities, you can compare the effects of market volatilities on Stone Harbor and Rivernorth Opportunities 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 Stone Harbor with a short position of Rivernorth Opportunities. Check out your portfolio center. Please also check ongoing floating volatility patterns of Stone Harbor and Rivernorth Opportunities.

Diversification Opportunities for Stone Harbor and Rivernorth Opportunities

-0.32

Correlation Coefficient

Stone Harbor  Rivernorth Opportunities

Very good diversification

The 3 months correlation between Stone and Rivernorth is -0.32. Overlapping area represents the amount of risk that can be diversified away by holding Stone Harbor Emerging and Rivernorth Opportunities in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Rivernorth Opportunities and Stone Harbor 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 Stone Harbor Emerging are associated (or correlated) with Rivernorth Opportunities. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Rivernorth Opportunities has no effect on the direction of Stone Harbor i.e., Stone Harbor and Rivernorth Opportunities go up and down completely randomly.

Pair Corralation between Stone Harbor and Rivernorth Opportunities

If you would invest  1,198  in Rivernorth Opportunities on September 4, 2024 and sell it today you would earn a total of  68.00  from holding Rivernorth Opportunities or generate 5.68% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	1.56%
Values	Daily Returns

Stone Harbor Emerging  vs.  Rivernorth Opportunities

Stone Harbor Emerging

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Stone Harbor Emerging has generated negative risk-adjusted returns adding no value to fund investors. Despite fairly strong fundamental indicators, Stone Harbor is not utilizing all of its potentials. The recent stock price confusion, may contribute to short-horizon losses for the traders.

Rivernorth Opportunities

Risk-Adjusted Performance

11 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Rivernorth Opportunities are ranked lower than 11 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly stable forward indicators, Rivernorth Opportunities is not utilizing all of its potentials. The latest stock price fuss, may contribute to near-short-term losses for the sophisticated investors.

Pair Trading with Stone Harbor and Rivernorth Opportunities

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

The idea behind Stone Harbor Emerging and Rivernorth Opportunities 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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.