Correlation Between Intermediate Bond and Qs Defensive
Can any of the company-specific risk be diversified away by investing in both Intermediate Bond and Qs Defensive 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 Intermediate Bond and Qs Defensive into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Intermediate Bond Fund and Qs Defensive Growth, you can compare the effects of market volatilities on Intermediate Bond and Qs Defensive 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 Intermediate Bond with a short position of Qs Defensive. Check out your portfolio center. Please also check ongoing floating volatility patterns of Intermediate Bond and Qs Defensive.
Diversification Opportunities for Intermediate Bond and Qs Defensive
0.48 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Intermediate and LMLRX is 0.48. Overlapping area represents the amount of risk that can be diversified away by holding Intermediate Bond Fund and Qs Defensive Growth in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Qs Defensive Growth and Intermediate Bond 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 Intermediate Bond Fund are associated (or correlated) with Qs Defensive. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Qs Defensive Growth has no effect on the direction of Intermediate Bond i.e., Intermediate Bond and Qs Defensive go up and down completely randomly.
Pair Corralation between Intermediate Bond and Qs Defensive
Assuming the 90 days horizon Intermediate Bond Fund is expected to generate 0.35 times more return on investment than Qs Defensive. However, Intermediate Bond Fund is 2.83 times less risky than Qs Defensive. It trades about 0.14 of its potential returns per unit of risk. Qs Defensive Growth is currently generating about -0.1 per unit of risk. If you would invest 1,273 in Intermediate Bond Fund on August 27, 2025 and sell it today you would earn a total of 5.00 from holding Intermediate Bond Fund or generate 0.39% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Intermediate Bond Fund vs. Qs Defensive Growth
Performance |
| Timeline |
| Intermediate Bond |
| Qs Defensive Growth |
Intermediate Bond and Qs Defensive Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Intermediate Bond and Qs Defensive
The main advantage of trading using opposite Intermediate Bond and Qs Defensive positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Intermediate Bond position performs unexpectedly, Qs Defensive 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 Qs Defensive will offset losses from the drop in Qs Defensive's long position.| Intermediate Bond vs. Europac Gold Fund | Intermediate Bond vs. Goldman Sachs Clean | Intermediate Bond vs. Invesco Gold Special | Intermediate Bond vs. Oppenheimer Gold Special |
| Qs Defensive vs. Financials Ultrasector Profund | Qs Defensive vs. Gabelli Global Financial | Qs Defensive vs. Icon Financial Fund | Qs Defensive vs. Vanguard Financials 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 Global Correlations module to find global opportunities by holding instruments from different markets.
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