Correlation Between Multimanager Lifestyle and Emerging Markets
Can any of the company-specific risk be diversified away by investing in both Multimanager Lifestyle and Emerging Markets 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 Multimanager Lifestyle and Emerging Markets into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Multimanager Lifestyle Aggressive and Emerging Markets Fund, you can compare the effects of market volatilities on Multimanager Lifestyle and Emerging Markets 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 Multimanager Lifestyle with a short position of Emerging Markets. Check out your portfolio center. Please also check ongoing floating volatility patterns of Multimanager Lifestyle and Emerging Markets.
Diversification Opportunities for Multimanager Lifestyle and Emerging Markets
0.95 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Multimanager and Emerging is 0.95. Overlapping area represents the amount of risk that can be diversified away by holding Multimanager Lifestyle Aggress and Emerging Markets Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Emerging Markets and Multimanager Lifestyle 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 Multimanager Lifestyle Aggressive are associated (or correlated) with Emerging Markets. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Emerging Markets has no effect on the direction of Multimanager Lifestyle i.e., Multimanager Lifestyle and Emerging Markets go up and down completely randomly.
Pair Corralation between Multimanager Lifestyle and Emerging Markets
Assuming the 90 days horizon Multimanager Lifestyle is expected to generate 1.35 times less return on investment than Emerging Markets. But when comparing it to its historical volatility, Multimanager Lifestyle Aggressive is 1.24 times less risky than Emerging Markets. It trades about 0.1 of its potential returns per unit of risk. Emerging Markets Fund is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest 996.00 in Emerging Markets Fund on May 22, 2025 and sell it today you would earn a total of 19.00 from holding Emerging Markets Fund or generate 1.91% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Multimanager Lifestyle Aggress vs. Emerging Markets Fund
Performance |
| Timeline |
| Multimanager Lifestyle |
| Emerging Markets |
Multimanager Lifestyle and Emerging Markets Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Multimanager Lifestyle and Emerging Markets
The main advantage of trading using opposite Multimanager Lifestyle and Emerging Markets positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Multimanager Lifestyle position performs unexpectedly, Emerging Markets 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 Emerging Markets will offset losses from the drop in Emerging Markets' long position.| Multimanager Lifestyle vs. Morningstar Growth Etf | Multimanager Lifestyle vs. Vanguard Growth And | Multimanager Lifestyle vs. Qs Defensive Growth | Multimanager Lifestyle vs. Chase Growth Fund |
| Emerging Markets vs. T Rowe Price | Emerging Markets vs. Profunds Large Cap Growth | Emerging Markets vs. Washington Mutual Investors | Emerging Markets vs. Alternative Asset 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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
Other Complementary Tools
| Funds Screener Find actively-traded funds from around the world traded on over 30 global exchanges | |
| Transaction History View history of all your transactions and understand their impact on performance | |
| Stock Tickers Use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites | |
| Portfolio Center All portfolio management and optimization tools to improve performance of your portfolios | |
| Equity Valuation Check real value of public entities based on technical and fundamental data |