Correlation Between First Trust and IBMI
Can any of the company-specific risk be diversified away by investing in both First Trust and IBMI 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 IBMI into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between First Trust Managed and IBMI, you can compare the effects of market volatilities on First Trust and IBMI 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 IBMI. Check out your portfolio center. Please also check ongoing floating volatility patterns of First Trust and IBMI.
Diversification Opportunities for First Trust and IBMI
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between First and IBMI is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding First Trust Managed and IBMI in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on IBMI 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 Managed are associated (or correlated) with IBMI. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of IBMI has no effect on the direction of First Trust i.e., First Trust and IBMI go up and down completely randomly.
Pair Corralation between First Trust and IBMI
If you would invest 5,085 in First Trust Managed on February 7, 2024 and sell it today you would earn a total of 18.00 from holding First Trust Managed or generate 0.35% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 0.0% |
| Values | Daily Returns |
First Trust Managed vs. IBMI
Performance |
| Timeline |
| First Trust Managed |
| IBMI |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
First Trust and IBMI Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with First Trust and IBMI
The main advantage of trading using opposite First Trust and IBMI positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if First Trust position performs unexpectedly, IBMI 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 IBMI will offset losses from the drop in IBMI's long position.| First Trust vs. SSGA Active Trust | First Trust vs. SPDR MarketAxess Investment | First Trust vs. SSGA Active Trust |
| IBMI vs. Vanguard Total Stock | IBMI vs. SPDR SP 500 | IBMI vs. iShares Core SP | IBMI vs. Vanguard Total Bond |
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 Dashboard module to portfolio dashboard that provides centralized access to all your investments.
Other Complementary Tools
| Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios | |
| Portfolio Center All portfolio management and optimization tools to improve performance of your portfolios | |
| Investing Opportunities Build portfolios using our predefined set of ideas and optimize them against your investing preferences | |
| Crypto Correlations Use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins | |
| Portfolio Suggestion Get suggestions outside of your existing asset allocation including your own model portfolios | |
| Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities | |
| Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings | |
| Sign In To Macroaxis Sign in to explore Macroaxis' wealth optimization platform and fintech modules | |
| Money Flow Index Determine momentum by analyzing Money Flow Index and other technical indicators | |
| Top Crypto Exchanges Search and analyze digital assets across top global cryptocurrency exchanges | |
| Insider Screener Find insiders across different sectors to evaluate their impact on performance | |
| Portfolio Optimization Compute new portfolio that will generate highest expected return given your specified tolerance for risk | |
| Global Markets Map Get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes |