diversifiable risk of combining Aquagold International and Janus Asia into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Aquagold International and Janus Asia Equity, you can compare the effects of market volatilities on Aquagold International and Janus Asia 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 Aquagold International with a short position of Janus Asia. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aquagold International and Janus Asia.
Diversification Opportunities for Aquagold International and Janus Asia
Pair Corralation between Aquagold International and Janus Asia
Aquagold International vs. JANUS ASIA EQUITY
Aquagold International and Janus Asia Volatility Contrast
Pair Trading with Aquagold International and Janus AsiaThe main advantage of trading using opposite Aquagold International and Janus Asia positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aquagold International position performs unexpectedly, Janus Asia 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 Janus Asia will offset losses from the drop in Janus Asia's long position. The idea behind Aquagold International and Janus Asia Equity 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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.