Correlation Between Origin Emerging and Income Growth

Specify exactly 2 symbols:
Can any of the company-specific risk be diversified away by investing in both Origin Emerging and Income Growth 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 Origin Emerging and Income Growth into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Origin Emerging Markets and Income Growth Fund, you can compare the effects of market volatilities on Origin Emerging and Income Growth 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 Origin Emerging with a short position of Income Growth. Check out your portfolio center. Please also check ongoing floating volatility patterns of Origin Emerging and Income Growth.

Diversification Opportunities for Origin Emerging and Income Growth

-0.53
  Correlation Coefficient

Excellent diversification

The 3 months correlation between Origin and Income is -0.53. Overlapping area represents the amount of risk that can be diversified away by holding Origin Emerging Markets and Income Growth Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Income Growth and Origin Emerging 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 Origin Emerging Markets are associated (or correlated) with Income Growth. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Income Growth has no effect on the direction of Origin Emerging i.e., Origin Emerging and Income Growth go up and down completely randomly.

Pair Corralation between Origin Emerging and Income Growth

Assuming the 90 days horizon Origin Emerging Markets is expected to under-perform the Income Growth. But the mutual fund apears to be less risky and, when comparing its historical volatility, Origin Emerging Markets is 14.71 times less risky than Income Growth. The mutual fund trades about -0.15 of its potential returns per unit of risk. The Income Growth Fund is currently generating about 0.19 of returns per unit of risk over similar time horizon. If you would invest  3,682  in Income Growth Fund on October 23, 2024 and sell it today you would earn a total of  83.00  from holding Income Growth Fund or generate 2.25% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthVery Weak
Accuracy77.78%
ValuesDaily Returns

Origin Emerging Markets  vs.  Income Growth Fund

 Performance 
       Timeline  
Origin Emerging Markets 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days Origin Emerging Markets has generated negative risk-adjusted returns adding no value to fund investors. In spite of fairly strong forward indicators, Origin Emerging is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.
Income Growth 

Risk-Adjusted Performance

3 of 100

 
Weak
 
Strong
Weak
Compared to the overall equity markets, risk-adjusted returns on investments in Income Growth Fund are ranked lower than 3 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong basic indicators, Income Growth is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Origin Emerging and Income Growth Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Origin Emerging and Income Growth

The main advantage of trading using opposite Origin Emerging and Income Growth positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Origin Emerging position performs unexpectedly, Income Growth 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 Income Growth will offset losses from the drop in Income Growth's long position.
The idea behind Origin Emerging Markets and Income Growth 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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..

Other Complementary Tools

Latest Portfolios
Quick portfolio dashboard that showcases your latest portfolios
Volatility Analysis
Get historical volatility and risk analysis based on latest market data
CEOs Directory
Screen CEOs from public companies around the world
Portfolio Analyzer
Portfolio analysis module that provides access to portfolio diagnostics and optimization engine
Portfolio Center
All portfolio management and optimization tools to improve performance of your portfolios