Correlation Between Brookfield Corp and RiverNorth Flexible

Can any of the company-specific risk be diversified away by investing in both Brookfield Corp and RiverNorth Flexible 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 Brookfield Corp and RiverNorth Flexible into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Brookfield Corp and RiverNorth Flexible Municipalome, you can compare the effects of market volatilities on Brookfield Corp and RiverNorth Flexible 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 Brookfield Corp with a short position of RiverNorth Flexible. Check out your portfolio center. Please also check ongoing floating volatility patterns of Brookfield Corp and RiverNorth Flexible.

Diversification Opportunities for Brookfield Corp and RiverNorth Flexible

-0.2

Correlation Coefficient

Brookfield Corp  RiverNorth Flexible

Good diversification

The 3 months correlation between Brookfield and RiverNorth is -0.2. Overlapping area represents the amount of risk that can be diversified away by holding Brookfield Corp and RiverNorth Flexible Municipalo in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on RiverNorth Flexible and Brookfield Corp 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 Brookfield Corp are associated (or correlated) with RiverNorth Flexible. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of RiverNorth Flexible has no effect on the direction of Brookfield Corp i.e., Brookfield Corp and RiverNorth Flexible go up and down completely randomly.

Pair Corralation between Brookfield Corp and RiverNorth Flexible

Allowing for the 90-day total investment horizon Brookfield Corp is expected to generate 2.95 times more return on investment than RiverNorth Flexible. However, Brookfield Corp is 2.95 times more volatile than RiverNorth Flexible Municipalome. It trades about 0.2 of its potential returns per unit of risk. RiverNorth Flexible Municipalome is currently generating about -0.02 per unit of risk. If you would invest  5,581  in Brookfield Corp on May 7, 2025 and sell it today you would earn a total of  1,081  from holding Brookfield Corp or generate 19.37% return on investment over 90 days.

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

Brookfield Corp  vs.  RiverNorth Flexible Municipalo

Brookfield Corp

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Brookfield Corp are ranked lower than 15 (%) of all global equities and portfolios over the last 90 days. In spite of very weak basic indicators, Brookfield Corp displayed solid returns over the last few months and may actually be approaching a breakup point.

RiverNorth Flexible

Risk-Adjusted Performance

Weakest

Over the last 90 days RiverNorth Flexible Municipalome has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly strong primary indicators, RiverNorth Flexible is not utilizing all of its potentials. The recent stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Brookfield Corp and RiverNorth Flexible

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

The idea behind Brookfield Corp and RiverNorth Flexible Municipalome 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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.