Correlation Between Matthews Asia and Intrepid Endurance

Can any of the company-specific risk be diversified away by investing in both Matthews Asia and Intrepid Endurance 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 Matthews Asia and Intrepid Endurance into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Matthews Asia Dividend and Intrepid Endurance Fund, you can compare the effects of market volatilities on Matthews Asia and Intrepid Endurance 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 Matthews Asia with a short position of Intrepid Endurance. Check out your portfolio center. Please also check ongoing floating volatility patterns of Matthews Asia and Intrepid Endurance.

Diversification Opportunities for Matthews Asia and Intrepid Endurance

-0.07

Correlation Coefficient

Matthews Asia  Intrepid Endurance

Good diversification

The 3 months correlation between Matthews and Intrepid is -0.07. Overlapping area represents the amount of risk that can be diversified away by holding Matthews Asia Dividend and Intrepid Endurance Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Intrepid Endurance and Matthews Asia 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 Matthews Asia Dividend are associated (or correlated) with Intrepid Endurance. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Intrepid Endurance has no effect on the direction of Matthews Asia i.e., Matthews Asia and Intrepid Endurance go up and down completely randomly.

Pair Corralation between Matthews Asia and Intrepid Endurance

If you would invest  1,625  in Intrepid Endurance Fund on October 10, 2024 and sell it today you would earn a total of  0.00  from holding Intrepid Endurance Fund or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	5.0%
Values	Daily Returns

Matthews Asia Dividend  vs.  Intrepid Endurance Fund

Matthews Asia Dividend

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Matthews Asia Dividend has generated negative risk-adjusted returns adding no value to fund investors. In spite of latest weak performance, the Fund's forward indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the fund investors.

Intrepid Endurance

Risk-Adjusted Performance

0 of 100

Insignificant

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

Pair Trading with Matthews Asia and Intrepid Endurance

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

The idea behind Matthews Asia Dividend and Intrepid Endurance 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.

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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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.