Correlation Between Coreshares Index and Assetmix

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

By analyzing existing cross correlation between Coreshares Index Tracker and Assetmix Ci Balanced, you can compare the effects of market volatilities on Coreshares Index and Assetmix 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 Coreshares Index with a short position of Assetmix. Check out your portfolio center. Please also check ongoing floating volatility patterns of Coreshares Index and Assetmix.

Diversification Opportunities for Coreshares Index and Assetmix

0.81

Correlation Coefficient

Coreshares Index  Assetmix

Very poor diversification

The 3 months correlation between Coreshares and Assetmix is 0.81. Overlapping area represents the amount of risk that can be diversified away by holding Coreshares Index Tracker and Assetmix Ci Balanced in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Assetmix Ci Balanced and Coreshares Index 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 Coreshares Index Tracker are associated (or correlated) with Assetmix. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Assetmix Ci Balanced has no effect on the direction of Coreshares Index i.e., Coreshares Index and Assetmix go up and down completely randomly.

Pair Corralation between Coreshares Index and Assetmix

Assuming the 90 days trading horizon Coreshares Index Tracker is expected to generate 2.18 times more return on investment than Assetmix. However, Coreshares Index is 2.18 times more volatile than Assetmix Ci Balanced. It trades about 0.11 of its potential returns per unit of risk. Assetmix Ci Balanced is currently generating about 0.2 per unit of risk. If you would invest  104,300  in Coreshares Index Tracker on September 5, 2024 and sell it today you would earn a total of  7,000  from holding Coreshares Index Tracker or generate 6.71% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Strong
Accuracy	98.44%
Values	Daily Returns

Coreshares Index Tracker  vs.  Assetmix Ci Balanced

Coreshares Index Tracker

Risk-Adjusted Performance

8 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Coreshares Index Tracker are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. Despite somewhat unsteady fundamental indicators, Coreshares Index may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Assetmix Ci Balanced

Risk-Adjusted Performance

15 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Assetmix Ci Balanced are ranked lower than 15 (%) of all funds and portfolios of funds over the last 90 days. Despite somewhat strong basic indicators, Assetmix is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Coreshares Index and Assetmix

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

The idea behind Coreshares Index Tracker and Assetmix Ci Balanced 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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.