Correlation Between Global Real and Multi-strategy Income

Can any of the company-specific risk be diversified away by investing in both Global Real and Multi-strategy Income 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 Global Real and Multi-strategy Income into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Global Real Estate and Multi Strategy Income Fund, you can compare the effects of market volatilities on Global Real and Multi-strategy Income 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 Global Real with a short position of Multi-strategy Income. Check out your portfolio center. Please also check ongoing floating volatility patterns of Global Real and Multi-strategy Income.

Diversification Opportunities for Global Real and Multi-strategy Income

0.83

Correlation Coefficient

Global Real  Multi-strategy Income

Very poor diversification

The 3 months correlation between Global and Multi-strategy is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding Global Real Estate and Multi Strategy Income Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Multi Strategy Income and Global Real 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 Global Real Estate are associated (or correlated) with Multi-strategy Income. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Multi Strategy Income has no effect on the direction of Global Real i.e., Global Real and Multi-strategy Income go up and down completely randomly.

Pair Corralation between Global Real and Multi-strategy Income

Assuming the 90 days horizon Global Real is expected to generate 5.63 times less return on investment than Multi-strategy Income. In addition to that, Global Real is 2.17 times more volatile than Multi Strategy Income Fund. It trades about 0.01 of its total potential returns per unit of risk. Multi Strategy Income Fund is currently generating about 0.14 per unit of volatility. If you would invest  978.00  in Multi Strategy Income Fund on July 13, 2025 and sell it today you would earn a total of  28.00  from holding Multi Strategy Income Fund or generate 2.86% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Strong
Accuracy	98.46%
Values	Daily Returns

Global Real Estate  vs.  Multi Strategy Income Fund

Global Real Estate

Risk-Adjusted Performance

Weakest

Over the last 90 days Global Real Estate has generated negative risk-adjusted returns adding no value to fund investors. In spite of fairly strong basic indicators, Global Real is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Multi Strategy Income

Risk-Adjusted Performance

Fair

Compared to the overall equity markets, risk-adjusted returns on investments in Multi Strategy Income Fund are ranked lower than 10 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong basic indicators, Multi-strategy Income is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Global Real and Multi-strategy Income

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

The idea behind Global Real Estate and Multi Strategy Income Fund 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 Portfolio File Import module to quickly import all of your third-party portfolios from your local drive in csv format.