Correlation Between Performance Trust and Transamerica Intermediate
Can any of the company-specific risk be diversified away by investing in both Performance Trust and Transamerica Intermediate 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 Performance Trust and Transamerica Intermediate into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Performance Trust Municipal and Transamerica Intermediate Muni, you can compare the effects of market volatilities on Performance Trust and Transamerica Intermediate 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 Performance Trust with a short position of Transamerica Intermediate. Check out your portfolio center. Please also check ongoing floating volatility patterns of Performance Trust and Transamerica Intermediate.
Diversification Opportunities for Performance Trust and Transamerica Intermediate
0.99 | Correlation Coefficient |
No risk reduction
The 3 months correlation between Performance and Transamerica is 0.99. Overlapping area represents the amount of risk that can be diversified away by holding Performance Trust Municipal and Transamerica Intermediate Muni in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Transamerica Intermediate and Performance Trust 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 Performance Trust Municipal are associated (or correlated) with Transamerica Intermediate. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Transamerica Intermediate has no effect on the direction of Performance Trust i.e., Performance Trust and Transamerica Intermediate go up and down completely randomly.
Pair Corralation between Performance Trust and Transamerica Intermediate
Assuming the 90 days horizon Performance Trust Municipal is expected to generate 1.24 times more return on investment than Transamerica Intermediate. However, Performance Trust is 1.24 times more volatile than Transamerica Intermediate Muni. It trades about 0.49 of its potential returns per unit of risk. Transamerica Intermediate Muni is currently generating about 0.42 per unit of risk. If you would invest 2,172 in Performance Trust Municipal on September 1, 2025 and sell it today you would earn a total of 113.00 from holding Performance Trust Municipal or generate 5.2% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Performance Trust Municipal vs. Transamerica Intermediate Muni
Performance |
| Timeline |
| Performance Trust |
| Transamerica Intermediate |
Performance Trust and Transamerica Intermediate Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Performance Trust and Transamerica Intermediate
The main advantage of trading using opposite Performance Trust and Transamerica Intermediate positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Performance Trust position performs unexpectedly, Transamerica Intermediate 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 Transamerica Intermediate will offset losses from the drop in Transamerica Intermediate's long position.| Performance Trust vs. Goldman Sachs Clean | Performance Trust vs. Invesco Gold Special | Performance Trust vs. The Gold Bullion | Performance Trust vs. International Investors Gold |
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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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