Correlation Between Viking Tax and Integrity High

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

By analyzing existing cross correlation between Viking Tax Free Fund and Integrity High Income, you can compare the effects of market volatilities on Viking Tax and Integrity High 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 Viking Tax with a short position of Integrity High. Check out your portfolio center. Please also check ongoing floating volatility patterns of Viking Tax and Integrity High.

Diversification Opportunities for Viking Tax and Integrity High

0.49

Correlation Coefficient

Viking Tax  Integrity High

Very weak diversification

The 3 months correlation between Viking and Integrity is 0.49. Overlapping area represents the amount of risk that can be diversified away by holding Viking Tax Free Fund and Integrity High Income in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Integrity High Income and Viking Tax 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 Viking Tax Free Fund are associated (or correlated) with Integrity High. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Integrity High Income has no effect on the direction of Viking Tax i.e., Viking Tax and Integrity High go up and down completely randomly.

Pair Corralation between Viking Tax and Integrity High

Assuming the 90 days horizon Viking Tax is expected to generate 4.41 times less return on investment than Integrity High. In addition to that, Viking Tax is 1.08 times more volatile than Integrity High Income. It trades about 0.06 of its total potential returns per unit of risk. Integrity High Income is currently generating about 0.28 per unit of volatility. If you would invest  710.00  in Integrity High Income on September 15, 2024 and sell it today you would earn a total of  47.00  from holding Integrity High Income or generate 6.62% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	99.21%
Values	Daily Returns

Viking Tax Free Fund  vs.  Integrity High Income

Viking Tax Free

Risk-Adjusted Performance

0 of 100

Very Weak

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

Integrity High Income

Risk-Adjusted Performance

10 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Integrity High Income are ranked lower than 10 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong forward indicators, Integrity High is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Viking Tax and Integrity High

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

The idea behind Viking Tax Free Fund and Integrity High Income 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 Global Correlations module to find global opportunities by holding instruments from different markets.