Correlation Between Short-intermediate and Federated Strategic
Can any of the company-specific risk be diversified away by investing in both Short-intermediate and Federated Strategic 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 Short-intermediate and Federated Strategic into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Short Intermediate Bond Fund and Federated Strategic Income, you can compare the effects of market volatilities on Short-intermediate and Federated Strategic 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 Short-intermediate with a short position of Federated Strategic. Check out your portfolio center. Please also check ongoing floating volatility patterns of Short-intermediate and Federated Strategic.
Diversification Opportunities for Short-intermediate and Federated Strategic
0.67 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Short-intermediate and Federated is 0.67. Overlapping area represents the amount of risk that can be diversified away by holding Short Intermediate Bond Fund and Federated Strategic Income in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Federated Strategic and Short-intermediate 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 Short Intermediate Bond Fund are associated (or correlated) with Federated Strategic. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Federated Strategic has no effect on the direction of Short-intermediate i.e., Short-intermediate and Federated Strategic go up and down completely randomly.
Pair Corralation between Short-intermediate and Federated Strategic
Assuming the 90 days horizon Short-intermediate is expected to generate 1.84 times less return on investment than Federated Strategic. But when comparing it to its historical volatility, Short Intermediate Bond Fund is 1.17 times less risky than Federated Strategic. It trades about 0.2 of its potential returns per unit of risk. Federated Strategic Income is currently generating about 0.31 of returns per unit of risk over similar time horizon. If you would invest 808.00 in Federated Strategic Income on May 26, 2025 and sell it today you would earn a total of 25.00 from holding Federated Strategic Income or generate 3.09% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Short Intermediate Bond Fund vs. Federated Strategic Income
Performance |
| Timeline |
| Short Intermediate Bond |
| Federated Strategic |
Short-intermediate and Federated Strategic Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Short-intermediate and Federated Strategic
The main advantage of trading using opposite Short-intermediate and Federated Strategic positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Short-intermediate position performs unexpectedly, Federated Strategic 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 Strategic will offset losses from the drop in Federated Strategic's long position.| Short-intermediate vs. Small Pany Fund | Short-intermediate vs. Balanced Fund Institutional | Short-intermediate vs. Income Fund Institutional | Short-intermediate vs. Credit Suisse Floating |
| Federated Strategic vs. The Hartford Global | Federated Strategic vs. Templeton Global Balanced | Federated Strategic vs. Alliancebernstein Global Highome | Federated Strategic vs. The Hartford 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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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