Correlation Between Rational Dividend and Global Multi-strategy
Can any of the company-specific risk be diversified away by investing in both Rational Dividend and Global Multi-strategy 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 Rational Dividend and Global Multi-strategy into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Rational Dividend Capture and Global Multi Strategy Fund, you can compare the effects of market volatilities on Rational Dividend and Global Multi-strategy 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 Rational Dividend with a short position of Global Multi-strategy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Rational Dividend and Global Multi-strategy.
Diversification Opportunities for Rational Dividend and Global Multi-strategy
0.91 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Rational and Global is 0.91. Overlapping area represents the amount of risk that can be diversified away by holding Rational Dividend Capture and Global Multi Strategy Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Global Multi Strategy and Rational Dividend 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 Rational Dividend Capture are associated (or correlated) with Global Multi-strategy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Global Multi Strategy has no effect on the direction of Rational Dividend i.e., Rational Dividend and Global Multi-strategy go up and down completely randomly.
Pair Corralation between Rational Dividend and Global Multi-strategy
Assuming the 90 days horizon Rational Dividend Capture is expected to generate 2.39 times more return on investment than Global Multi-strategy. However, Rational Dividend is 2.39 times more volatile than Global Multi Strategy Fund. It trades about 0.13 of its potential returns per unit of risk. Global Multi Strategy Fund is currently generating about 0.3 per unit of risk. If you would invest 956.00 in Rational Dividend Capture on June 6, 2025 and sell it today you would earn a total of 38.00 from holding Rational Dividend Capture or generate 3.97% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Rational Dividend Capture vs. Global Multi Strategy Fund
Performance |
| Timeline |
| Rational Dividend Capture |
| Global Multi Strategy |
Rational Dividend and Global Multi-strategy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Rational Dividend and Global Multi-strategy
The main advantage of trading using opposite Rational Dividend and Global Multi-strategy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Rational Dividend position performs unexpectedly, Global Multi-strategy 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 Global Multi-strategy will offset losses from the drop in Global Multi-strategy's long position.| Rational Dividend vs. Goldman Sachs Financial | Rational Dividend vs. Transamerica Financial Life | Rational Dividend vs. Icon Financial Fund | Rational Dividend vs. Prudential Financial Services |
| Global Multi-strategy vs. Rbc Money Market | Global Multi-strategy vs. Putnam Money Market | Global Multi-strategy vs. Fidelity Money Market | Global Multi-strategy vs. Prudential Government Money |
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 Anywhere module to track or share privately all of your investments from the convenience of any device.
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