Correlation Between Spectrum Advisors and Columbia Mortgage

Can any of the company-specific risk be diversified away by investing in both Spectrum Advisors and Columbia Mortgage 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 Spectrum Advisors and Columbia Mortgage into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Spectrum Advisors Preferred and Columbia Mortgage Opportunities, you can compare the effects of market volatilities on Spectrum Advisors and Columbia Mortgage 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 Spectrum Advisors with a short position of Columbia Mortgage. Check out your portfolio center. Please also check ongoing floating volatility patterns of Spectrum Advisors and Columbia Mortgage.

Diversification Opportunities for Spectrum Advisors and Columbia Mortgage

0.82

Correlation Coefficient

Spectrum Advisors  Columbia Mortgage

Very poor diversification

The 3 months correlation between Spectrum and Columbia is 0.82. Overlapping area represents the amount of risk that can be diversified away by holding Spectrum Advisors Preferred and Columbia Mortgage Opportunitie in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Columbia Mortgage and Spectrum Advisors 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 Spectrum Advisors Preferred are associated (or correlated) with Columbia Mortgage. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Columbia Mortgage has no effect on the direction of Spectrum Advisors i.e., Spectrum Advisors and Columbia Mortgage go up and down completely randomly.

Pair Corralation between Spectrum Advisors and Columbia Mortgage

Assuming the 90 days horizon Spectrum Advisors is expected to generate 1.32 times less return on investment than Columbia Mortgage. In addition to that, Spectrum Advisors is 2.49 times more volatile than Columbia Mortgage Opportunities. It trades about 0.09 of its total potential returns per unit of risk. Columbia Mortgage Opportunities is currently generating about 0.28 per unit of volatility. If you would invest  825.00  in Columbia Mortgage Opportunities on July 25, 2025 and sell it today you would earn a total of  38.00  from holding Columbia Mortgage Opportunities or generate 4.61% return on investment over 90 days.

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

Spectrum Advisors Preferred  vs.  Columbia Mortgage Opportunitie

Spectrum Advisors

Risk-Adjusted Performance

Mild

Compared to the overall equity markets, risk-adjusted returns on investments in Spectrum Advisors Preferred are ranked lower than 6 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong technical and fundamental indicators, Spectrum Advisors is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Columbia Mortgage

Risk-Adjusted Performance

Solid

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

Pair Trading with Spectrum Advisors and Columbia Mortgage

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

The idea behind Spectrum Advisors Preferred and Columbia Mortgage Opportunities 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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.