Correlation Between Exchange Traded and Leuthold Core

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

By analyzing existing cross correlation between Exchange Traded Concepts and Leuthold Core ETF, you can compare the effects of market volatilities on Exchange Traded and Leuthold Core 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 Exchange Traded with a short position of Leuthold Core. Check out your portfolio center. Please also check ongoing floating volatility patterns of Exchange Traded and Leuthold Core.

Diversification Opportunities for Exchange Traded and Leuthold Core

0.78

Correlation Coefficient

Exchange Traded  Leuthold Core

Poor diversification

The 3 months correlation between Exchange and Leuthold is 0.78. Overlapping area represents the amount of risk that can be diversified away by holding Exchange Traded Concepts and Leuthold Core ETF in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Leuthold Core ETF and Exchange Traded 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 Exchange Traded Concepts are associated (or correlated) with Leuthold Core. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Leuthold Core ETF has no effect on the direction of Exchange Traded i.e., Exchange Traded and Leuthold Core go up and down completely randomly.

Pair Corralation between Exchange Traded and Leuthold Core

If you would invest  3,459  in Leuthold Core ETF on September 2, 2024 and sell it today you would earn a total of  166.00  from holding Leuthold Core ETF or generate 4.8% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	1.56%
Values	Daily Returns

Exchange Traded Concepts  vs.  Leuthold Core ETF

Exchange Traded Concepts

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Exchange Traded Concepts has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound basic indicators, Exchange Traded is not utilizing all of its potentials. The current stock price tumult, may contribute to shorter-term losses for the shareholders.

Leuthold Core ETF

Risk-Adjusted Performance

13 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Leuthold Core ETF are ranked lower than 13 (%) of all global equities and portfolios over the last 90 days. Even with relatively invariable fundamental indicators, Leuthold Core is not utilizing all of its potentials. The current stock price agitation, may contribute to short-term losses for the retail investors.

Pair Trading with Exchange Traded and Leuthold Core

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

The idea behind Exchange Traded Concepts and Leuthold Core ETF 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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.