Correlation Between Multisector Bond and Columbia High
Can any of the company-specific risk be diversified away by investing in both Multisector Bond and Columbia High 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 Multisector Bond and Columbia High into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Multisector Bond Sma and Columbia High Yield, you can compare the effects of market volatilities on Multisector Bond and Columbia High 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 Multisector Bond with a short position of Columbia High. Check out your portfolio center. Please also check ongoing floating volatility patterns of Multisector Bond and Columbia High.
Diversification Opportunities for Multisector Bond and Columbia High
0.99 | Correlation Coefficient |
No risk reduction
The 3 months correlation between Multisector and Columbia is 0.99. Overlapping area represents the amount of risk that can be diversified away by holding Multisector Bond Sma and Columbia High Yield in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Columbia High Yield and Multisector 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 Multisector Bond Sma are associated (or correlated) with Columbia High. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Columbia High Yield has no effect on the direction of Multisector Bond i.e., Multisector Bond and Columbia High go up and down completely randomly.
Pair Corralation between Multisector Bond and Columbia High
Assuming the 90 days horizon Multisector Bond Sma is expected to generate 1.97 times more return on investment than Columbia High. However, Multisector Bond is 1.97 times more volatile than Columbia High Yield. It trades about 0.24 of its potential returns per unit of risk. Columbia High Yield is currently generating about 0.33 per unit of risk. If you would invest 1,365 in Multisector Bond Sma on May 30, 2025 and sell it today you would earn a total of 55.00 from holding Multisector Bond Sma or generate 4.03% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Multisector Bond Sma vs. Columbia High Yield
Performance |
| Timeline |
| Multisector Bond Sma |
| Columbia High Yield |
Multisector Bond and Columbia High Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Multisector Bond and Columbia High
The main advantage of trading using opposite Multisector Bond and Columbia High positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Multisector Bond position performs unexpectedly, Columbia High 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 Columbia High will offset losses from the drop in Columbia High's long position.| Multisector Bond vs. Columbia Porate Income | Multisector Bond vs. Columbia Ultra Short | Multisector Bond vs. Columbia Treasury Index | Multisector Bond vs. Multi Manager Directional Alternative |
| Columbia High vs. Columbia Porate Income | Columbia High vs. Columbia Ultra Short | Columbia High vs. Columbia Treasury Index | Columbia High vs. Multi Manager Directional Alternative |
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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
Other Complementary Tools
| Premium Stories Follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope | |
| Analyst Advice Analyst recommendations and target price estimates broken down by several categories | |
| Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk | |
| Content Syndication Quickly integrate customizable finance content to your own investment portal | |
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets |