Correlation Between Elfun Trusts and 91327BAB6

Can any of the company-specific risk be diversified away by investing in both Elfun Trusts and 91327BAB6 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 Elfun Trusts and 91327BAB6 into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Elfun Trusts Elfun and US91327BAB62, you can compare the effects of market volatilities on Elfun Trusts and 91327BAB6 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 Elfun Trusts with a short position of 91327BAB6. Check out your portfolio center. Please also check ongoing floating volatility patterns of Elfun Trusts and 91327BAB6.

Diversification Opportunities for Elfun Trusts and 91327BAB6

-0.36

Correlation Coefficient

Elfun Trusts  91327BAB6

Very good diversification

The 3 months correlation between Elfun and 91327BAB6 is -0.36. Overlapping area represents the amount of risk that can be diversified away by holding Elfun Trusts Elfun and US91327BAB62 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on US91327BAB62 and Elfun Trusts 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 Elfun Trusts Elfun are associated (or correlated) with 91327BAB6. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of US91327BAB62 has no effect on the direction of Elfun Trusts i.e., Elfun Trusts and 91327BAB6 go up and down completely randomly.

Pair Corralation between Elfun Trusts and 91327BAB6

Assuming the 90 days horizon Elfun Trusts is expected to generate 32.79 times less return on investment than 91327BAB6. But when comparing it to its historical volatility, Elfun Trusts Elfun is 75.63 times less risky than 91327BAB6. It trades about 0.14 of its potential returns per unit of risk. US91327BAB62 is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest  8,036  in US91327BAB62 on September 18, 2024 and sell it today you would lose (598.00) from holding US91327BAB62 or give up 7.44% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	90.91%
Values	Daily Returns

Elfun Trusts Elfun  vs.  US91327BAB62

Elfun Trusts Elfun

Risk-Adjusted Performance

12 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Elfun Trusts Elfun are ranked lower than 12 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak basic indicators, Elfun Trusts may actually be approaching a critical reversion point that can send shares even higher in January 2025.

US91327BAB62

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days US91327BAB62 has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Bond's basic indicators remain somewhat strong which may send shares a bit higher in January 2025. The current disturbance may also be a sign of long term up-swing for US91327BAB62 investors.

Pair Trading with Elfun Trusts and 91327BAB6

The main advantage of trading using opposite Elfun Trusts and 91327BAB6 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Elfun Trusts position performs unexpectedly, 91327BAB6 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 91327BAB6 will offset losses from the drop in 91327BAB6's long position.

The idea behind Elfun Trusts Elfun and US91327BAB62 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 Portfolio Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.