Correlation Between Anfield Universal and First Trust

Can any of the company-specific risk be diversified away by investing in both Anfield Universal and First Trust 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 Anfield Universal and First Trust into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Anfield Universal Fixed and First Trust Structured, you can compare the effects of market volatilities on Anfield Universal and First Trust 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 Anfield Universal with a short position of First Trust. Check out your portfolio center. Please also check ongoing floating volatility patterns of Anfield Universal and First Trust.

Diversification Opportunities for Anfield Universal and First Trust

0.93

Correlation Coefficient

Anfield Universal  First Trust

Almost no diversification

The 3 months correlation between Anfield and First is 0.93. Overlapping area represents the amount of risk that can be diversified away by holding Anfield Universal Fixed and First Trust Structured in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on First Trust Structured and Anfield Universal 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 Anfield Universal Fixed are associated (or correlated) with First Trust. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of First Trust Structured has no effect on the direction of Anfield Universal i.e., Anfield Universal and First Trust go up and down completely randomly.

Pair Corralation between Anfield Universal and First Trust

Given the investment horizon of 90 days Anfield Universal is expected to generate 1.16 times less return on investment than First Trust. But when comparing it to its historical volatility, Anfield Universal Fixed is 1.57 times less risky than First Trust. It trades about 0.2 of its potential returns per unit of risk. First Trust Structured is currently generating about 0.15 of returns per unit of risk over similar time horizon. If you would invest  2,008  in First Trust Structured on April 29, 2025 and sell it today you would earn a total of  56.00  from holding First Trust Structured or generate 2.79% return on investment over 90 days.

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

Anfield Universal Fixed  vs.  First Trust Structured

Anfield Universal Fixed

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Anfield Universal Fixed are ranked lower than 15 (%) of all global equities and portfolios over the last 90 days. Despite nearly stable forward indicators, Anfield Universal is not utilizing all of its potentials. The latest stock price disturbance, may contribute to mid-run losses for the stockholders.

First Trust Structured

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in First Trust Structured are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. In spite of very healthy forward indicators, First Trust is not utilizing all of its potentials. The current stock price disarray, may contribute to short-term losses for the investors.

Pair Trading with Anfield Universal and First Trust

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

The idea behind Anfield Universal Fixed and First Trust Structured 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 AI Portfolio Prophet module to use AI to generate optimal portfolios and find profitable investment opportunities.