Correlation Between Real Return and Federated Short-intermedia

Can any of the company-specific risk be diversified away by investing in both Real Return and Federated Short-intermedia 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 Real Return and Federated Short-intermedia into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Real Return Asset and Federated Short Intermediate Duration, you can compare the effects of market volatilities on Real Return and Federated Short-intermedia 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 Real Return with a short position of Federated Short-intermedia. Check out your portfolio center. Please also check ongoing floating volatility patterns of Real Return and Federated Short-intermedia.

Diversification Opportunities for Real Return and Federated Short-intermedia

0.89

Correlation Coefficient

Real Return  Federated Short-intermedia

Very poor diversification

The 3 months correlation between Real and Federated is 0.89. Overlapping area represents the amount of risk that can be diversified away by holding Real Return Asset and Federated Short Intermediate D in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Federated Short-intermedia and Real Return 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 Real Return Asset are associated (or correlated) with Federated Short-intermedia. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Federated Short-intermedia has no effect on the direction of Real Return i.e., Real Return and Federated Short-intermedia go up and down completely randomly.

Pair Corralation between Real Return and Federated Short-intermedia

Assuming the 90 days horizon Real Return Asset is expected to generate 7.01 times more return on investment than Federated Short-intermedia. However, Real Return is 7.01 times more volatile than Federated Short Intermediate Duration. It trades about 0.19 of its potential returns per unit of risk. Federated Short Intermediate Duration is currently generating about 0.28 per unit of risk. If you would invest  1,127  in Real Return Asset on July 28, 2025 and sell it today you would earn a total of  82.00  from holding Real Return Asset or generate 7.28% return on investment over 90 days.

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

Real Return Asset  vs.  Federated Short Intermediate D

Real Return Asset

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Real Return Asset are ranked lower than 15 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak forward indicators, Real Return may actually be approaching a critical reversion point that can send shares even higher in November 2025.

Federated Short-intermedia

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Federated Short Intermediate Duration are ranked lower than 22 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong basic indicators, Federated Short-intermedia is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Real Return and Federated Short-intermedia

The main advantage of trading using opposite Real Return and Federated Short-intermedia positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Real Return position performs unexpectedly, Federated Short-intermedia 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 Federated Short-intermedia will offset losses from the drop in Federated Short-intermedia's long position.

The idea behind Real Return Asset and Federated Short Intermediate Duration 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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.