Correlation Between First Trust and CornerCap Fundametrics

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

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

Diversification Opportunities for First Trust and CornerCap Fundametrics

0.23

Correlation Coefficient

First Trust  CornerCap Fundametrics

Modest diversification

The 3 months correlation between First and CornerCap is 0.23. Overlapping area represents the amount of risk that can be diversified away by holding First Trust Indxx and CornerCap Fundametrics Large C in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CornerCap Fundametrics and First Trust 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 First Trust Indxx are associated (or correlated) with CornerCap Fundametrics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CornerCap Fundametrics has no effect on the direction of First Trust i.e., First Trust and CornerCap Fundametrics go up and down completely randomly.

Pair Corralation between First Trust and CornerCap Fundametrics

Given the investment horizon of 90 days First Trust Indxx is expected to generate 1.74 times more return on investment than CornerCap Fundametrics. However, First Trust is 1.74 times more volatile than CornerCap Fundametrics Large Cap. It trades about 0.04 of its potential returns per unit of risk. CornerCap Fundametrics Large Cap is currently generating about 0.07 per unit of risk. If you would invest  3,856  in First Trust Indxx on September 4, 2025 and sell it today you would earn a total of  106.00  from holding First Trust Indxx or generate 2.75% return on investment over 90 days.

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

First Trust Indxx  vs.  CornerCap Fundametrics Large C

First Trust Indxx

Risk-Adjusted Performance

Soft

Compared to the overall equity markets, risk-adjusted returns on investments in First Trust Indxx are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. Despite quite persistent basic indicators, First Trust is not utilizing all of its potentials. The latest stock price mess, may contribute to short-term losses for the institutional investors.

CornerCap Fundametrics

Risk-Adjusted Performance

Mild

Compared to the overall equity markets, risk-adjusted returns on investments in CornerCap Fundametrics Large Cap are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. Despite quite persistent basic indicators, CornerCap Fundametrics is not utilizing all of its potentials. The current stock price mess, may contribute to short-term losses for the institutional investors.

Pair Trading with First Trust and CornerCap Fundametrics

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

The idea behind First Trust Indxx and CornerCap Fundametrics Large Cap 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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..