Correlation Between Federated Global and Federated Real
Can any of the company-specific risk be diversified away by investing in both Federated Global and Federated Real 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 Global and Federated Real into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Federated Global Allocation and Federated Real Return, you can compare the effects of market volatilities on Federated Global and Federated Real 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 Global with a short position of Federated Real. Check out your portfolio center. Please also check ongoing floating volatility patterns of Federated Global and Federated Real.
Diversification Opportunities for Federated Global and Federated Real
0.92 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Federated and Federated is 0.92. Overlapping area represents the amount of risk that can be diversified away by holding Federated Global Allocation and Federated Real Return in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Federated Real Return and Federated Global 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 Global Allocation are associated (or correlated) with Federated Real. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Federated Real Return has no effect on the direction of Federated Global i.e., Federated Global and Federated Real go up and down completely randomly.
Pair Corralation between Federated Global and Federated Real
Assuming the 90 days horizon Federated Global Allocation is expected to generate 1.47 times more return on investment than Federated Real. However, Federated Global is 1.47 times more volatile than Federated Real Return. It trades about 0.23 of its potential returns per unit of risk. Federated Real Return is currently generating about 0.17 per unit of risk. If you would invest 2,068 in Federated Global Allocation on May 31, 2025 and sell it today you would earn a total of 126.00 from holding Federated Global Allocation or generate 6.09% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 98.41% |
| Values | Daily Returns |
Federated Global Allocation vs. Federated Real Return
Performance |
| Timeline |
| Federated Global All |
| Federated Real Return |
Federated Global and Federated Real Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Federated Global and Federated Real
The main advantage of trading using opposite Federated Global and Federated Real positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Federated Global position performs unexpectedly, Federated Real 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 Real will offset losses from the drop in Federated Real's long position.| Federated Global vs. Federated Total Return | Federated Global vs. Federated Max Cap Index | Federated Global vs. Federated Kaufmann Small | Federated Global vs. Federated U S |
| Federated Real vs. Prudential High Yield | Federated Real vs. Artisan High Income | Federated Real vs. Pioneer High Yield | Federated Real vs. Aggressive Balanced Allocation |
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.
Other Complementary Tools
| Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum | |
| Stocks Directory Find actively traded stocks across global markets | |
| Funds Screener Find actively-traded funds from around the world traded on over 30 global exchanges | |
| Options Analysis Analyze and evaluate options and option chains as a potential hedge for your portfolios | |
| Commodity Directory Find actively traded commodities issued by global exchanges |