Correlation Between Columbia Flexible and Intermediate Government
Can any of the company-specific risk be diversified away by investing in both Columbia Flexible and Intermediate Government 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 Columbia Flexible and Intermediate Government into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Columbia Flexible Capital and Intermediate Government Bond, you can compare the effects of market volatilities on Columbia Flexible and Intermediate Government 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 Columbia Flexible with a short position of Intermediate Government. Check out your portfolio center. Please also check ongoing floating volatility patterns of Columbia Flexible and Intermediate Government.
Diversification Opportunities for Columbia Flexible and Intermediate Government
0.8 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Columbia and Intermediate is 0.8. Overlapping area represents the amount of risk that can be diversified away by holding Columbia Flexible Capital and Intermediate Government Bond in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Intermediate Government and Columbia Flexible 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 Columbia Flexible Capital are associated (or correlated) with Intermediate Government. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Intermediate Government has no effect on the direction of Columbia Flexible i.e., Columbia Flexible and Intermediate Government go up and down completely randomly.
Pair Corralation between Columbia Flexible and Intermediate Government
Assuming the 90 days horizon Columbia Flexible Capital is expected to generate 2.79 times more return on investment than Intermediate Government. However, Columbia Flexible is 2.79 times more volatile than Intermediate Government Bond. It trades about 0.24 of its potential returns per unit of risk. Intermediate Government Bond is currently generating about 0.21 per unit of risk. If you would invest 1,418 in Columbia Flexible Capital on June 10, 2025 and sell it today you would earn a total of 80.00 from holding Columbia Flexible Capital or generate 5.64% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Columbia Flexible Capital vs. Intermediate Government Bond
Performance |
| Timeline |
| Columbia Flexible Capital |
| Intermediate Government |
Columbia Flexible and Intermediate Government Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Columbia Flexible and Intermediate Government
The main advantage of trading using opposite Columbia Flexible and Intermediate Government positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Columbia Flexible position performs unexpectedly, Intermediate Government 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 Intermediate Government will offset losses from the drop in Intermediate Government's long position.| Columbia Flexible vs. Leader Short Term Bond | Columbia Flexible vs. Angel Oak Ultrashort | Columbia Flexible vs. John Hancock Municipal | Columbia Flexible vs. Catholic Responsible Investments |
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 Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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