Correlation Between Advantage Portfolio and Frontier Markets
Can any of the company-specific risk be diversified away by investing in both Advantage Portfolio and Frontier 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 Advantage Portfolio and Frontier Markets into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Advantage Portfolio Class and Frontier Markets Portfolio, you can compare the effects of market volatilities on Advantage Portfolio and Frontier 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 Advantage Portfolio with a short position of Frontier Markets. Check out your portfolio center. Please also check ongoing floating volatility patterns of Advantage Portfolio and Frontier Markets.
Diversification Opportunities for Advantage Portfolio and Frontier Markets
0.96 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Advantage and Frontier is 0.96. Overlapping area represents the amount of risk that can be diversified away by holding Advantage Portfolio Class and Frontier Markets Portfolio in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Frontier Markets Por and Advantage Portfolio 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 Advantage Portfolio Class are associated (or correlated) with Frontier Markets. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Frontier Markets Por has no effect on the direction of Advantage Portfolio i.e., Advantage Portfolio and Frontier Markets go up and down completely randomly.
Pair Corralation between Advantage Portfolio and Frontier Markets
Assuming the 90 days horizon Advantage Portfolio Class is expected to generate 2.62 times more return on investment than Frontier Markets. However, Advantage Portfolio is 2.62 times more volatile than Frontier Markets Portfolio. It trades about 0.07 of its potential returns per unit of risk. Frontier Markets Portfolio is currently generating about 0.06 per unit of risk. If you would invest 1,414 in Advantage Portfolio Class on March 25, 2025 and sell it today you would earn a total of 930.00 from holding Advantage Portfolio Class or generate 65.77% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 99.8% |
| Values | Daily Returns |
Advantage Portfolio Class vs. Frontier Markets Portfolio
Performance |
| Timeline |
| Advantage Portfolio Class |
| Frontier Markets Por |
Advantage Portfolio and Frontier Markets Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Advantage Portfolio and Frontier Markets
The main advantage of trading using opposite Advantage Portfolio and Frontier Markets positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Advantage Portfolio position performs unexpectedly, Frontier 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 Frontier Markets will offset losses from the drop in Frontier Markets' long position.| Advantage Portfolio vs. Putnam Money Market | Advantage Portfolio vs. Vanguard Money Market | Advantage Portfolio vs. Schwab Government Money | Advantage Portfolio vs. Fidelity Money Market |
| Frontier Markets vs. Frontier Markets Portfolio | Frontier Markets vs. Hennessy Japan Fund | Frontier Markets vs. Hennessy Japan Small | Frontier Markets vs. Emerald Growth Fund |
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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
Other Complementary Tools
| Companies Directory Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals | |
| Options Analysis Analyze and evaluate options and option chains as a potential hedge for your portfolios | |
| Idea Optimizer Use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio | |
| Stocks Directory Find actively traded stocks across global markets | |
| Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings |