Correlation Between Eagle Capital and Alphacentric Hedged
Can any of the company-specific risk be diversified away by investing in both Eagle Capital and Alphacentric Hedged 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 Eagle Capital and Alphacentric Hedged into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Eagle Capital Appreciation and Alphacentric Hedged Market, you can compare the effects of market volatilities on Eagle Capital and Alphacentric Hedged 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 Eagle Capital with a short position of Alphacentric Hedged. Check out your portfolio center. Please also check ongoing floating volatility patterns of Eagle Capital and Alphacentric Hedged.
Diversification Opportunities for Eagle Capital and Alphacentric Hedged
0.6 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Eagle and Alphacentric is 0.6. Overlapping area represents the amount of risk that can be diversified away by holding Eagle Capital Appreciation and Alphacentric Hedged Market in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Alphacentric Hedged and Eagle Capital 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 Eagle Capital Appreciation are associated (or correlated) with Alphacentric Hedged. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Alphacentric Hedged has no effect on the direction of Eagle Capital i.e., Eagle Capital and Alphacentric Hedged go up and down completely randomly.
Pair Corralation between Eagle Capital and Alphacentric Hedged
Assuming the 90 days horizon Eagle Capital Appreciation is expected to generate 2.24 times more return on investment than Alphacentric Hedged. However, Eagle Capital is 2.24 times more volatile than Alphacentric Hedged Market. It trades about 0.07 of its potential returns per unit of risk. Alphacentric Hedged Market is currently generating about 0.07 per unit of risk. If you would invest 4,067 in Eagle Capital Appreciation on October 9, 2024 and sell it today you would earn a total of 2,082 from holding Eagle Capital Appreciation or generate 51.19% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Significant |
Accuracy | 100.0% |
Values | Daily Returns |
Eagle Capital Appreciation vs. Alphacentric Hedged Market
Performance |
Timeline |
Eagle Capital Apprec |
Alphacentric Hedged |
Eagle Capital and Alphacentric Hedged Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Eagle Capital and Alphacentric Hedged
The main advantage of trading using opposite Eagle Capital and Alphacentric Hedged positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Eagle Capital position performs unexpectedly, Alphacentric Hedged 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 Alphacentric Hedged will offset losses from the drop in Alphacentric Hedged's long position.Eagle Capital vs. Chartwell Short Duration | Eagle Capital vs. Chartwell Short Duration | Eagle Capital vs. Carillon Chartwell Short | Eagle Capital vs. Eagle Growth Income |
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 CEOs Directory module to screen CEOs from public companies around the world.
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