Correlation Between Investment Managers and Harbor ETF

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Can any of the company-specific risk be diversified away by investing in both Investment Managers and Harbor ETF 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 Investment Managers and Harbor ETF into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Investment Managers Series and Harbor ETF Trust, you can compare the effects of market volatilities on Investment Managers and Harbor ETF 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 Investment Managers with a short position of Harbor ETF. Check out your portfolio center. Please also check ongoing floating volatility patterns of Investment Managers and Harbor ETF.

Diversification Opportunities for Investment Managers and Harbor ETF

0.91
  Correlation Coefficient

Almost no diversification

The 3 months correlation between Investment and Harbor is 0.91. Overlapping area represents the amount of risk that can be diversified away by holding Investment Managers Series and Harbor ETF Trust in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Harbor ETF Trust and Investment Managers 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 Investment Managers Series are associated (or correlated) with Harbor ETF. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Harbor ETF Trust has no effect on the direction of Investment Managers i.e., Investment Managers and Harbor ETF go up and down completely randomly.

Pair Corralation between Investment Managers and Harbor ETF

Considering the 90-day investment horizon Investment Managers Series is expected to generate 1.38 times more return on investment than Harbor ETF. However, Investment Managers is 1.38 times more volatile than Harbor ETF Trust. It trades about 0.18 of its potential returns per unit of risk. Harbor ETF Trust is currently generating about 0.24 per unit of risk. If you would invest  1,454  in Investment Managers Series on September 6, 2024 and sell it today you would earn a total of  114.00  from holding Investment Managers Series or generate 7.84% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthVery Strong
Accuracy100.0%
ValuesDaily Returns

Investment Managers Series  vs.  Harbor ETF Trust

 Performance 
       Timeline  
Investment Managers 

Risk-Adjusted Performance

14 of 100

 
Weak
 
Strong
Good
Compared to the overall equity markets, risk-adjusted returns on investments in Investment Managers Series are ranked lower than 14 (%) of all global equities and portfolios over the last 90 days. Despite fairly fragile basic indicators, Investment Managers may actually be approaching a critical reversion point that can send shares even higher in January 2025.
Harbor ETF Trust 

Risk-Adjusted Performance

18 of 100

 
Weak
 
Strong
Solid
Compared to the overall equity markets, risk-adjusted returns on investments in Harbor ETF Trust are ranked lower than 18 (%) of all global equities and portfolios over the last 90 days. Even with relatively weak basic indicators, Harbor ETF may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Investment Managers and Harbor ETF Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Investment Managers and Harbor ETF

The main advantage of trading using opposite Investment Managers and Harbor ETF positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Investment Managers position performs unexpectedly, Harbor ETF 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 Harbor ETF will offset losses from the drop in Harbor ETF's long position.
The idea behind Investment Managers Series and Harbor ETF Trust 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 Money Managers module to screen money managers from public funds and ETFs managed around the world.

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