Correlation Between Counterpoint Tactical and Doubleline

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

By analyzing existing cross correlation between Counterpoint Tactical Income and Doubleline E Fixed, you can compare the effects of market volatilities on Counterpoint Tactical and Doubleline 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 Counterpoint Tactical with a short position of Doubleline. Check out your portfolio center. Please also check ongoing floating volatility patterns of Counterpoint Tactical and Doubleline.

Diversification Opportunities for Counterpoint Tactical and Doubleline

-0.6

Correlation Coefficient

Counterpoint Tactical  Doubleline

Excellent diversification

The 3 months correlation between Counterpoint and Doubleline is -0.6. Overlapping area represents the amount of risk that can be diversified away by holding Counterpoint Tactical Income and Doubleline E Fixed in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Doubleline E Fixed and Counterpoint Tactical 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 Counterpoint Tactical Income are associated (or correlated) with Doubleline. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Doubleline E Fixed has no effect on the direction of Counterpoint Tactical i.e., Counterpoint Tactical and Doubleline go up and down completely randomly.

Pair Corralation between Counterpoint Tactical and Doubleline

Assuming the 90 days horizon Counterpoint Tactical Income is expected to generate 0.38 times more return on investment than Doubleline. However, Counterpoint Tactical Income is 2.64 times less risky than Doubleline. It trades about 0.17 of its potential returns per unit of risk. Doubleline E Fixed is currently generating about -0.16 per unit of risk. If you would invest  1,134  in Counterpoint Tactical Income on September 15, 2024 and sell it today you would earn a total of  13.00  from holding Counterpoint Tactical Income or generate 1.15% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	98.46%
Values	Daily Returns

Counterpoint Tactical Income  vs.  Doubleline E Fixed

Counterpoint Tactical

Risk-Adjusted Performance

13 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Counterpoint Tactical Income are ranked lower than 13 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong basic indicators, Counterpoint Tactical is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Doubleline E Fixed

Risk-Adjusted Performance

0 of 100

Very Weak

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

Pair Trading with Counterpoint Tactical and Doubleline

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

The idea behind Counterpoint Tactical Income and Doubleline E Fixed 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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.