Correlation Between Invesco Emerging and Eaton Vance
Can any of the company-specific risk be diversified away by investing in both Invesco Emerging and Eaton Vance 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 Invesco Emerging and Eaton Vance into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Invesco Emerging Markets and Eaton Vance Emerging, you can compare the effects of market volatilities on Invesco Emerging and Eaton Vance 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 Invesco Emerging with a short position of Eaton Vance. Check out your portfolio center. Please also check ongoing floating volatility patterns of Invesco Emerging and Eaton Vance.
Diversification Opportunities for Invesco Emerging and Eaton Vance
0.56 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Invesco and Eaton is 0.56. Overlapping area represents the amount of risk that can be diversified away by holding Invesco Emerging Markets and Eaton Vance Emerging in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eaton Vance Emerging and Invesco Emerging 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 Invesco Emerging Markets are associated (or correlated) with Eaton Vance. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Eaton Vance Emerging has no effect on the direction of Invesco Emerging i.e., Invesco Emerging and Eaton Vance go up and down completely randomly.
Pair Corralation between Invesco Emerging and Eaton Vance
Assuming the 90 days horizon Invesco Emerging Markets is expected to under-perform the Eaton Vance. In addition to that, Invesco Emerging is 1.01 times more volatile than Eaton Vance Emerging. It trades about -0.31 of its total potential returns per unit of risk. Eaton Vance Emerging is currently generating about -0.22 per unit of volatility. If you would invest 342.00 in Eaton Vance Emerging on January 24, 2024 and sell it today you would lose (8.00) from holding Eaton Vance Emerging or give up 2.34% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Invesco Emerging Markets vs. Eaton Vance Emerging
Performance |
| Timeline |
| Invesco Emerging Markets |
| Eaton Vance Emerging |
Invesco Emerging and Eaton Vance Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Invesco Emerging and Eaton Vance
The main advantage of trading using opposite Invesco Emerging and Eaton Vance positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Invesco Emerging position performs unexpectedly, Eaton Vance 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 Eaton Vance will offset losses from the drop in Eaton Vance's long position.| Invesco Emerging vs. Invesco Municipal Income | Invesco Emerging vs. Invesco Municipal Income | Invesco Emerging vs. Invesco Municipal Income | Invesco Emerging vs. Oppenheimer Rising Dividends |
| Eaton Vance vs. Eaton Vance Emerging | Eaton Vance vs. Eaton Vance Global | Eaton Vance vs. Eaton Vance Floating Rate | Eaton Vance vs. Eaton Vance Global |
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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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