Correlation Between Cboe Vest and Aig Government

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

By analyzing existing cross correlation between Cboe Vest Bitcoin and Aig Government Money, you can compare the effects of market volatilities on Cboe Vest and Aig Government 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 Cboe Vest with a short position of Aig Government. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cboe Vest and Aig Government.

Diversification Opportunities for Cboe Vest and Aig Government

-0.58

Correlation Coefficient

Cboe Vest  Aig Government

Excellent diversification

The 3 months correlation between Cboe and Aig is -0.58. Overlapping area represents the amount of risk that can be diversified away by holding Cboe Vest Bitcoin and Aig Government Money in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aig Government Money and Cboe Vest 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 Cboe Vest Bitcoin are associated (or correlated) with Aig Government. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aig Government Money has no effect on the direction of Cboe Vest i.e., Cboe Vest and Aig Government go up and down completely randomly.

Pair Corralation between Cboe Vest and Aig Government

Assuming the 90 days horizon Cboe Vest Bitcoin is expected to generate 14.27 times more return on investment than Aig Government. However, Cboe Vest is 14.27 times more volatile than Aig Government Money. It trades about 0.37 of its potential returns per unit of risk. Aig Government Money is currently generating about 0.08 per unit of risk. If you would invest  2,238  in Cboe Vest Bitcoin on August 28, 2024 and sell it today you would earn a total of  683.00  from holding Cboe Vest Bitcoin or generate 30.52% return on investment over 90 days.

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

Cboe Vest Bitcoin  vs.  Aig Government Money

Cboe Vest Bitcoin

Risk-Adjusted Performance

19 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Cboe Vest Bitcoin are ranked lower than 19 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak basic indicators, Cboe Vest showed solid returns over the last few months and may actually be approaching a breakup point.

Aig Government Money

Risk-Adjusted Performance

0 of 100

Very Weak

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

Pair Trading with Cboe Vest and Aig Government

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

The idea behind Cboe Vest Bitcoin and Aig Government Money 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 Portfolio Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.