Correlation Between Invesco Diversified and Federated Emerging
Can any of the company-specific risk be diversified away by investing in both Invesco Diversified and Federated Emerging 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 Diversified and Federated Emerging into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Invesco Diversified Dividend and Federated Emerging Market, you can compare the effects of market volatilities on Invesco Diversified and Federated Emerging 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 Diversified with a short position of Federated Emerging. Check out your portfolio center. Please also check ongoing floating volatility patterns of Invesco Diversified and Federated Emerging.
Diversification Opportunities for Invesco Diversified and Federated Emerging
0.94 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Invesco and Federated is 0.94. Overlapping area represents the amount of risk that can be diversified away by holding Invesco Diversified Dividend and Federated Emerging Market in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Federated Emerging Market and Invesco Diversified 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 Diversified Dividend are associated (or correlated) with Federated Emerging. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Federated Emerging Market has no effect on the direction of Invesco Diversified i.e., Invesco Diversified and Federated Emerging go up and down completely randomly.
Pair Corralation between Invesco Diversified and Federated Emerging
Assuming the 90 days horizon Invesco Diversified Dividend is expected to generate 2.26 times more return on investment than Federated Emerging. However, Invesco Diversified is 2.26 times more volatile than Federated Emerging Market. It trades about 0.18 of its potential returns per unit of risk. Federated Emerging Market is currently generating about 0.39 per unit of risk. If you would invest 1,840 in Invesco Diversified Dividend on June 10, 2025 and sell it today you would earn a total of 114.00 from holding Invesco Diversified Dividend or generate 6.2% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Invesco Diversified Dividend vs. Federated Emerging Market
Performance |
| Timeline |
| Invesco Diversified |
| Federated Emerging Market |
Invesco Diversified and Federated Emerging Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Invesco Diversified and Federated Emerging
The main advantage of trading using opposite Invesco Diversified and Federated Emerging positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Invesco Diversified position performs unexpectedly, Federated Emerging 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 Federated Emerging will offset losses from the drop in Federated Emerging's long position.| Invesco Diversified vs. Dreyfusstandish Global Fixed | Invesco Diversified vs. T Rowe Price | Invesco Diversified vs. Gmo Global Equity | Invesco Diversified vs. Dreyfusstandish Global Fixed |
| Federated Emerging vs. Ab Bond Inflation | Federated Emerging vs. Rbc Short Duration | Federated Emerging vs. Touchstone Funds Group | Federated Emerging vs. Pioneer Bond Fund |
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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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