Correlation Between Vy(r) Clarion and International Value

Can any of the company-specific risk be diversified away by investing in both Vy(r) Clarion and International Value 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 Vy(r) Clarion and International Value into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Vy Clarion Real and International Value Fund, you can compare the effects of market volatilities on Vy(r) Clarion and International Value 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 Vy(r) Clarion with a short position of International Value. Check out your portfolio center. Please also check ongoing floating volatility patterns of Vy(r) Clarion and International Value.

Diversification Opportunities for Vy(r) Clarion and International Value

0.69

Correlation Coefficient

Vy(r) Clarion  International Value

Poor diversification

The 3 months correlation between Vy(r) and International is 0.69. Overlapping area represents the amount of risk that can be diversified away by holding Vy Clarion Real and International Value Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on International Value and Vy(r) Clarion 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 Vy Clarion Real are associated (or correlated) with International Value. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of International Value has no effect on the direction of Vy(r) Clarion i.e., Vy(r) Clarion and International Value go up and down completely randomly.

Pair Corralation between Vy(r) Clarion and International Value

Assuming the 90 days horizon Vy Clarion Real is expected to under-perform the International Value. In addition to that, Vy(r) Clarion is 1.59 times more volatile than International Value Fund. It trades about -0.03 of its total potential returns per unit of risk. International Value Fund is currently generating about 0.21 per unit of volatility. If you would invest  836.00  in International Value Fund on October 25, 2024 and sell it today you would earn a total of  26.00  from holding International Value Fund or generate 3.11% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	94.74%
Values	Daily Returns

Vy Clarion Real  vs.  International Value Fund

Vy Clarion Real

Risk-Adjusted Performance

0 of 100

Very Weak

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

International Value

Risk-Adjusted Performance

0 of 100

Very Weak

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

Pair Trading with Vy(r) Clarion and International Value

The main advantage of trading using opposite Vy(r) Clarion and International Value positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Vy(r) Clarion position performs unexpectedly, International Value 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 International Value will offset losses from the drop in International Value's long position.

The idea behind Vy Clarion Real and International Value Fund 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 CEOs Directory module to screen CEOs from public companies around the world.