Correlation Between The Us and Asg Global

Can any of the company-specific risk be diversified away by investing in both The Us and Asg Global 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 The Us and Asg Global into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between The Government Fixed and Asg Global Alternatives, you can compare the effects of market volatilities on The Us and Asg Global 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 The Us with a short position of Asg Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of The Us and Asg Global.

Diversification Opportunities for The Us and Asg Global

0.21

Correlation Coefficient

The Us  Asg Global

Modest diversification

The 3 months correlation between The and Asg is 0.21. Overlapping area represents the amount of risk that can be diversified away by holding The Government Fixed and Asg Global Alternatives in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Asg Global Alternatives and The Us 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 The Government Fixed are associated (or correlated) with Asg Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Asg Global Alternatives has no effect on the direction of The Us i.e., The Us and Asg Global go up and down completely randomly.

Pair Corralation between The Us and Asg Global

Assuming the 90 days horizon The Government Fixed is expected to under-perform the Asg Global. But the mutual fund apears to be less risky and, when comparing its historical volatility, The Government Fixed is 1.83 times less risky than Asg Global. The mutual fund trades about -0.63 of its potential returns per unit of risk. The Asg Global Alternatives is currently generating about -0.15 of returns per unit of risk over similar time horizon. If you would invest  1,066  in Asg Global Alternatives on October 11, 2024 and sell it today you would lose (12.00) from holding Asg Global Alternatives or give up 1.13% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	100.0%
Values	Daily Returns

The Government Fixed  vs.  Asg Global Alternatives

Government Fixed

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days The Government Fixed has generated negative risk-adjusted returns adding no value to fund investors. In spite of fairly strong basic indicators, The Us is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Asg Global Alternatives

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Asg Global Alternatives has generated negative risk-adjusted returns adding no value to fund investors. In spite of fairly strong basic indicators, Asg Global is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with The Us and Asg Global

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

The idea behind The Government Fixed and Asg Global Alternatives 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.

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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.