Correlation Between Retirement Living and Ivy Advantus

Can any of the company-specific risk be diversified away by investing in both Retirement Living and Ivy Advantus 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 Retirement Living and Ivy Advantus into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Retirement Living Through and Ivy Advantus Real, you can compare the effects of market volatilities on Retirement Living and Ivy Advantus 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 Retirement Living with a short position of Ivy Advantus. Check out your portfolio center. Please also check ongoing floating volatility patterns of Retirement Living and Ivy Advantus.

Diversification Opportunities for Retirement Living and Ivy Advantus

0.78

Correlation Coefficient

Retirement Living  Ivy Advantus

Poor diversification

The 3 months correlation between Retirement and Ivy is 0.78. Overlapping area represents the amount of risk that can be diversified away by holding Retirement Living Through and Ivy Advantus Real in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ivy Advantus Real and Retirement Living 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 Retirement Living Through are associated (or correlated) with Ivy Advantus. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ivy Advantus Real has no effect on the direction of Retirement Living i.e., Retirement Living and Ivy Advantus go up and down completely randomly.

Pair Corralation between Retirement Living and Ivy Advantus

Assuming the 90 days horizon Retirement Living Through is expected to generate 0.61 times more return on investment than Ivy Advantus. However, Retirement Living Through is 1.65 times less risky than Ivy Advantus. It trades about 0.32 of its potential returns per unit of risk. Ivy Advantus Real is currently generating about 0.13 per unit of risk. If you would invest  1,287  in Retirement Living Through on April 25, 2025 and sell it today you would earn a total of  132.00  from holding Retirement Living Through or generate 10.26% return on investment over 90 days.

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

Retirement Living Through  vs.  Ivy Advantus Real

Retirement Living Through

Risk-Adjusted Performance

Strong

Compared to the overall equity markets, risk-adjusted returns on investments in Retirement Living Through are ranked lower than 25 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak forward-looking signals, Retirement Living may actually be approaching a critical reversion point that can send shares even higher in August 2025.

Ivy Advantus Real

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Ivy Advantus Real are ranked lower than 10 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak forward indicators, Ivy Advantus may actually be approaching a critical reversion point that can send shares even higher in August 2025.

Pair Trading with Retirement Living and Ivy Advantus

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

The idea behind Retirement Living Through and Ivy Advantus Real 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 Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.