Correlation Between First Trust and Militia LongShort
Can any of the company-specific risk be diversified away by investing in both First Trust and Militia LongShort 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 First Trust and Militia LongShort into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between First Trust SMID and Militia LongShort Equity, you can compare the effects of market volatilities on First Trust and Militia LongShort 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 First Trust with a short position of Militia LongShort. Check out your portfolio center. Please also check ongoing floating volatility patterns of First Trust and Militia LongShort.
Diversification Opportunities for First Trust and Militia LongShort
-0.09 | Correlation Coefficient |
Good diversification
The 3 months correlation between First and Militia is -0.09. Overlapping area represents the amount of risk that can be diversified away by holding First Trust SMID and Militia LongShort Equity in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Militia LongShort Equity and First Trust 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 First Trust SMID are associated (or correlated) with Militia LongShort. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Militia LongShort Equity has no effect on the direction of First Trust i.e., First Trust and Militia LongShort go up and down completely randomly.
Pair Corralation between First Trust and Militia LongShort
Given the investment horizon of 90 days First Trust is expected to generate 19.16 times less return on investment than Militia LongShort. In addition to that, First Trust is 1.27 times more volatile than Militia LongShort Equity. It trades about 0.0 of its total potential returns per unit of risk. Militia LongShort Equity is currently generating about 0.08 per unit of volatility. If you would invest 3,165 in Militia LongShort Equity on August 15, 2025 and sell it today you would earn a total of 119.00 from holding Militia LongShort Equity or generate 3.76% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
First Trust SMID vs. Militia LongShort Equity
Performance |
| Timeline |
| First Trust SMID |
| Militia LongShort Equity |
First Trust and Militia LongShort Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with First Trust and Militia LongShort
The main advantage of trading using opposite First Trust and Militia LongShort positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if First Trust position performs unexpectedly, Militia LongShort 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 Militia LongShort will offset losses from the drop in Militia LongShort's long position.| First Trust vs. First Trust Nasdaq | First Trust vs. WBI BullBear Value | First Trust vs. ProShares Ultra SmallCap600 | First Trust vs. Strategy Shares NewfoundReSolve |
| Militia LongShort vs. Unlimited HFND Multi Strategy | Militia LongShort vs. Direxion Daily Retail | Militia LongShort vs. Hartford Multifactor Small | Militia LongShort vs. VanEck Indonesia Index |
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 File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
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