Correlation Between Saba Closed and FT Cboe
Can any of the company-specific risk be diversified away by investing in both Saba Closed and FT Cboe 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 Saba Closed and FT Cboe into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Saba Closed End Funds and FT Cboe Vest, you can compare the effects of market volatilities on Saba Closed and FT Cboe 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 Saba Closed with a short position of FT Cboe. Check out your portfolio center. Please also check ongoing floating volatility patterns of Saba Closed and FT Cboe.
Diversification Opportunities for Saba Closed and FT Cboe
0.81 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Saba and DNOV is 0.81. Overlapping area represents the amount of risk that can be diversified away by holding Saba Closed End Funds and FT Cboe Vest in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FT Cboe Vest and Saba Closed 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 Saba Closed End Funds are associated (or correlated) with FT Cboe. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FT Cboe Vest has no effect on the direction of Saba Closed i.e., Saba Closed and FT Cboe go up and down completely randomly.
Pair Corralation between Saba Closed and FT Cboe
Given the investment horizon of 90 days Saba Closed End Funds is expected to generate 1.71 times more return on investment than FT Cboe. However, Saba Closed is 1.71 times more volatile than FT Cboe Vest. It trades about 0.12 of its potential returns per unit of risk. FT Cboe Vest is currently generating about 0.13 per unit of risk. If you would invest 1,462 in Saba Closed End Funds on September 5, 2024 and sell it today you would earn a total of 783.00 from holding Saba Closed End Funds or generate 53.56% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Strong |
Accuracy | 100.0% |
Values | Daily Returns |
Saba Closed End Funds vs. FT Cboe Vest
Performance |
Timeline |
Saba Closed End |
FT Cboe Vest |
Saba Closed and FT Cboe Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Saba Closed and FT Cboe
The main advantage of trading using opposite Saba Closed and FT Cboe positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Saba Closed position performs unexpectedly, FT Cboe 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 FT Cboe will offset losses from the drop in FT Cboe's long position.Saba Closed vs. FT Cboe Vest | Saba Closed vs. First Trust Exchange Traded | Saba Closed vs. FT Cboe Vest | Saba Closed vs. Anfield Equity Sector |
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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
Other Complementary Tools
FinTech Suite Use AI to screen and filter profitable investment opportunities | |
Fundamentals Comparison Compare fundamentals across multiple equities to find investing opportunities | |
Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing | |
Latest Portfolios Quick portfolio dashboard that showcases your latest portfolios | |
Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings |