Correlation Between Amg Gwk and Dws Emerging

Can any of the company-specific risk be diversified away by investing in both Amg Gwk and Dws Emerging 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 Amg Gwk and Dws Emerging into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Amg Gwk Smallmid and Dws Emerging Markets, you can compare the effects of market volatilities on Amg Gwk and Dws Emerging 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 Amg Gwk with a short position of Dws Emerging. Check out your portfolio center. Please also check ongoing floating volatility patterns of Amg Gwk and Dws Emerging.

Diversification Opportunities for Amg Gwk and Dws Emerging

-0.14

Correlation Coefficient

Amg Gwk  Dws Emerging

Good diversification

The 3 months correlation between Amg and Dws is -0.14. Overlapping area represents the amount of risk that can be diversified away by holding Amg Gwk Smallmid and Dws Emerging Markets in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dws Emerging Markets and Amg Gwk 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 Amg Gwk Smallmid are associated (or correlated) with Dws Emerging. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dws Emerging Markets has no effect on the direction of Amg Gwk i.e., Amg Gwk and Dws Emerging go up and down completely randomly.

Pair Corralation between Amg Gwk and Dws Emerging

Assuming the 90 days horizon Amg Gwk Smallmid is expected to generate 1.09 times more return on investment than Dws Emerging. However, Amg Gwk is 1.09 times more volatile than Dws Emerging Markets. It trades about 0.08 of its potential returns per unit of risk. Dws Emerging Markets is currently generating about 0.06 per unit of risk. If you would invest  1,696  in Amg Gwk Smallmid on September 13, 2024 and sell it today you would earn a total of  338.00  from holding Amg Gwk Smallmid or generate 19.93% return on investment over 90 days.

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

Amg Gwk Smallmid  vs.  Dws Emerging Markets

Amg Gwk Smallmid

Risk-Adjusted Performance

11 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Amg Gwk Smallmid are ranked lower than 11 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak basic indicators, Amg Gwk may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Dws Emerging Markets

Risk-Adjusted Performance

5 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Dws Emerging Markets are ranked lower than 5 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong basic indicators, Dws Emerging is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Amg Gwk and Dws Emerging

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

The idea behind Amg Gwk Smallmid and Dws Emerging Markets 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 Bonds Directory module to find actively traded corporate debentures issued by US companies.