Correlation Between Federated Government and Federated Short
Can any of the company-specific risk be diversified away by investing in both Federated Government and Federated Short 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 Federated Government and Federated Short into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Federated Government Income and Federated Short Intermediate Duration, you can compare the effects of market volatilities on Federated Government and Federated Short 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 Federated Government with a short position of Federated Short. Check out your portfolio center. Please also check ongoing floating volatility patterns of Federated Government and Federated Short.
Diversification Opportunities for Federated Government and Federated Short
0.63 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Federated and Federated is 0.63. Overlapping area represents the amount of risk that can be diversified away by holding Federated Government Income and Federated Short Intermediate D in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Federated Short Inte and Federated Government 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 Federated Government Income are associated (or correlated) with Federated Short. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Federated Short Inte has no effect on the direction of Federated Government i.e., Federated Government and Federated Short go up and down completely randomly.
Pair Corralation between Federated Government and Federated Short
Assuming the 90 days horizon Federated Government is expected to generate 1.09 times less return on investment than Federated Short. In addition to that, Federated Government is 4.76 times more volatile than Federated Short Intermediate Duration. It trades about 0.08 of its total potential returns per unit of risk. Federated Short Intermediate Duration is currently generating about 0.39 per unit of volatility. If you would invest 996.00 in Federated Short Intermediate Duration on April 17, 2025 and sell it today you would earn a total of 5.00 from holding Federated Short Intermediate Duration or generate 0.5% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Federated Government Income vs. Federated Short Intermediate D
Performance |
| Timeline |
| Federated Government |
| Federated Short Inte |
Federated Government and Federated Short Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Federated Government and Federated Short
The main advantage of trading using opposite Federated Government and Federated Short positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Federated Government position performs unexpectedly, Federated Short 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 Short will offset losses from the drop in Federated Short's long position.| Federated Government vs. Wabmsx | Federated Government vs. Wmcanx | Federated Government vs. Flakqx | Federated Government vs. Ips Strategic Capital |
| Federated Short vs. Federated Intermediate Municipal | Federated Short vs. Federated Ultrashort Bond | Federated Short vs. Federated Gov Sec | Federated Short vs. Federated Government Income |
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 Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
Other Complementary Tools
| Instant Ratings Determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Portfolio Anywhere Track or share privately all of your investments from the convenience of any device | |
| Insider Screener Find insiders across different sectors to evaluate their impact on performance | |
| Funds Screener Find actively-traded funds from around the world traded on over 30 global exchanges | |
| My Watchlist Analysis Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like |