Correlation Between Ep Emerging and Investment Managers

Can any of the company-specific risk be diversified away by investing in both Ep Emerging and Investment Managers 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 Ep Emerging and Investment Managers into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Ep Emerging Markets and Investment Managers Series, you can compare the effects of market volatilities on Ep Emerging and Investment Managers 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 Ep Emerging with a short position of Investment Managers. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ep Emerging and Investment Managers.

Diversification Opportunities for Ep Emerging and Investment Managers

0.7

Correlation Coefficient

Ep Emerging  Investment Managers

Poor diversification

The 3 months correlation between EPASX and Investment is 0.7. Overlapping area represents the amount of risk that can be diversified away by holding Ep Emerging Markets and Investment Managers Series in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Investment Managers and Ep Emerging 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 Ep Emerging Markets are associated (or correlated) with Investment Managers. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Investment Managers has no effect on the direction of Ep Emerging i.e., Ep Emerging and Investment Managers go up and down completely randomly.

Pair Corralation between Ep Emerging and Investment Managers

Assuming the 90 days horizon Ep Emerging Markets is expected to generate 0.52 times more return on investment than Investment Managers. However, Ep Emerging Markets is 1.92 times less risky than Investment Managers. It trades about 0.21 of its potential returns per unit of risk. Investment Managers Series is currently generating about 0.1 per unit of risk. If you would invest  978.00  in Ep Emerging Markets on July 6, 2024 and sell it today you would earn a total of  123.00  from holding Ep Emerging Markets or generate 12.58% return on investment over 90 days.

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

Ep Emerging Markets  vs.  Investment Managers Series

Ep Emerging Markets

Risk-Adjusted Performance

16 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Ep Emerging Markets are ranked lower than 16 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak basic indicators, Ep Emerging may actually be approaching a critical reversion point that can send shares even higher in November 2024.

Investment Managers

Risk-Adjusted Performance

7 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Investment Managers Series are ranked lower than 7 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak forward indicators, Investment Managers may actually be approaching a critical reversion point that can send shares even higher in November 2024.

Pair Trading with Ep Emerging and Investment Managers

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

The idea behind Ep Emerging Markets and Investment Managers Series 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.

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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.