Correlation Between Access Capital and Vanguard Intermediate-ter

Can any of the company-specific risk be diversified away by investing in both Access Capital and Vanguard Intermediate-ter 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 Access Capital and Vanguard Intermediate-ter into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Access Capital Munity and Vanguard Intermediate Term Tax Exempt, you can compare the effects of market volatilities on Access Capital and Vanguard Intermediate-ter 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 Access Capital with a short position of Vanguard Intermediate-ter. Check out your portfolio center. Please also check ongoing floating volatility patterns of Access Capital and Vanguard Intermediate-ter.

Diversification Opportunities for Access Capital and Vanguard Intermediate-ter

0.24

Correlation Coefficient

Access Capital  Vanguard Intermediate-ter

Modest diversification

The 3 months correlation between Access and VANGUARD is 0.24. Overlapping area represents the amount of risk that can be diversified away by holding Access Capital Munity and Vanguard Intermediate Term Tax in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Vanguard Intermediate-ter and Access Capital 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 Access Capital Munity are associated (or correlated) with Vanguard Intermediate-ter. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Vanguard Intermediate-ter has no effect on the direction of Access Capital i.e., Access Capital and Vanguard Intermediate-ter go up and down completely randomly.

Pair Corralation between Access Capital and Vanguard Intermediate-ter

Assuming the 90 days horizon Access Capital Munity is expected to generate 0.81 times more return on investment than Vanguard Intermediate-ter. However, Access Capital Munity is 1.23 times less risky than Vanguard Intermediate-ter. It trades about -0.03 of its potential returns per unit of risk. Vanguard Intermediate Term Tax Exempt is currently generating about -0.09 per unit of risk. If you would invest  771.00  in Access Capital Munity on January 31, 2025 and sell it today you would lose (4.00) from holding Access Capital Munity or give up 0.52% of portfolio value over 90 days.

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

Access Capital Munity  vs.  Vanguard Intermediate Term Tax

Access Capital Munity

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Access Capital Munity are ranked lower than 6 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong basic indicators, Access Capital is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Vanguard Intermediate-ter

Risk-Adjusted Performance

Very Weak

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

Pair Trading with Access Capital and Vanguard Intermediate-ter

The main advantage of trading using opposite Access Capital and Vanguard Intermediate-ter positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Access Capital position performs unexpectedly, Vanguard Intermediate-ter 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 Vanguard Intermediate-ter will offset losses from the drop in Vanguard Intermediate-ter's long position.

The idea behind Access Capital Munity and Vanguard Intermediate Term Tax Exempt 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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.