Correlation Between Martin Currie and Roundhill Magnificent

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

By analyzing existing cross correlation between Martin Currie Sustainable and Roundhill Magnificent Seven, you can compare the effects of market volatilities on Martin Currie and Roundhill Magnificent 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 Martin Currie with a short position of Roundhill Magnificent. Check out your portfolio center. Please also check ongoing floating volatility patterns of Martin Currie and Roundhill Magnificent.

Diversification Opportunities for Martin Currie and Roundhill Magnificent

-0.74

Correlation Coefficient

Martin Currie  Roundhill Magnificent

Pay attention - limited upside

The 3 months correlation between Martin and Roundhill is -0.74. Overlapping area represents the amount of risk that can be diversified away by holding Martin Currie Sustainable and Roundhill Magnificent Seven in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Roundhill Magnificent and Martin Currie 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 Martin Currie Sustainable are associated (or correlated) with Roundhill Magnificent. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Roundhill Magnificent has no effect on the direction of Martin Currie i.e., Martin Currie and Roundhill Magnificent go up and down completely randomly.

Pair Corralation between Martin Currie and Roundhill Magnificent

Given the investment horizon of 90 days Martin Currie Sustainable is expected to under-perform the Roundhill Magnificent. But the etf apears to be less risky and, when comparing its historical volatility, Martin Currie Sustainable is 1.31 times less risky than Roundhill Magnificent. The etf trades about -0.15 of its potential returns per unit of risk. The Roundhill Magnificent Seven is currently generating about 0.34 of returns per unit of risk over similar time horizon. If you would invest  4,764  in Roundhill Magnificent Seven on September 4, 2024 and sell it today you would earn a total of  504.00  from holding Roundhill Magnificent Seven or generate 10.58% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	100.0%
Values	Daily Returns

Martin Currie Sustainable  vs.  Roundhill Magnificent Seven

Martin Currie Sustainable

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Martin Currie Sustainable has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest conflicting performance, the Etf's basic indicators remain sound and the latest tumult on Wall Street may also be a sign of longer-term gains for the fund shareholders.

Roundhill Magnificent

Risk-Adjusted Performance

17 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Roundhill Magnificent Seven are ranked lower than 17 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively weak technical and fundamental indicators, Roundhill Magnificent unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Martin Currie and Roundhill Magnificent

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

The idea behind Martin Currie Sustainable and Roundhill Magnificent Seven 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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.