Correlation Between Federated Investors and Diamond Hill
Can any of the company-specific risk be diversified away by investing in both Federated Investors and Diamond Hill 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 Federated Investors and Diamond Hill into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Federated Investors B and Diamond Hill Investment, you can compare the effects of market volatilities on Federated Investors and Diamond Hill 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 Federated Investors with a short position of Diamond Hill. Check out your portfolio center. Please also check ongoing floating volatility patterns of Federated Investors and Diamond Hill.
Diversification Opportunities for Federated Investors and Diamond Hill
-0.15 | Correlation Coefficient |
Good diversification
The 3 months correlation between Federated and Diamond is -0.15. Overlapping area represents the amount of risk that can be diversified away by holding Federated Investors B and Diamond Hill Investment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Diamond Hill Investment and Federated Investors 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 Federated Investors B are associated (or correlated) with Diamond Hill. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Diamond Hill Investment has no effect on the direction of Federated Investors i.e., Federated Investors and Diamond Hill go up and down completely randomly.
Pair Corralation between Federated Investors and Diamond Hill
Considering the 90-day investment horizon Federated Investors B is expected to generate 0.92 times more return on investment than Diamond Hill. However, Federated Investors B is 1.08 times less risky than Diamond Hill. It trades about 0.02 of its potential returns per unit of risk. Diamond Hill Investment is currently generating about 0.0 per unit of risk. If you would invest 2,919 in Federated Investors B on February 1, 2024 and sell it today you would earn a total of 366.00 from holding Federated Investors B or generate 12.54% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
Federated Investors B vs. Diamond Hill Investment
Performance |
Timeline |
Federated Investors |
Diamond Hill Investment |
Federated Investors and Diamond Hill Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Federated Investors and Diamond Hill
The main advantage of trading using opposite Federated Investors and Diamond Hill positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Federated Investors position performs unexpectedly, Diamond Hill 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 Diamond Hill will offset losses from the drop in Diamond Hill's long position.Federated Investors vs. Pimco Corporate Income | Federated Investors vs. Pimco Income Strategy | Federated Investors vs. Pcm Fund | Federated Investors vs. Pimco High Income |
Diamond Hill vs. Pimco Corporate Income | Diamond Hill vs. Pimco Income Strategy | Diamond Hill vs. Pcm Fund | Diamond Hill vs. Pimco High Income |
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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
Other Complementary Tools
Aroon Oscillator Analyze current equity momentum using Aroon Oscillator and other momentum ratios | |
Technical Analysis Check basic technical indicators and analysis based on most latest market data | |
Equity Search Search for actively traded equities including funds and ETFs from over 30 global markets | |
Idea Breakdown Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes | |
Funds Screener Find actively-traded funds from around the world traded on over 30 global exchanges |