Correlation Between Federated Mdt and Gmo Emerging
Can any of the company-specific risk be diversified away by investing in both Federated Mdt and Gmo Emerging 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 Federated Mdt and Gmo Emerging into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Federated Mdt Large and Gmo Emerging Markets, you can compare the effects of market volatilities on Federated Mdt and Gmo Emerging 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 Federated Mdt with a short position of Gmo Emerging. Check out your portfolio center. Please also check ongoing floating volatility patterns of Federated Mdt and Gmo Emerging.
Diversification Opportunities for Federated Mdt and Gmo Emerging
0.74 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Federated and Gmo is 0.74. Overlapping area represents the amount of risk that can be diversified away by holding Federated Mdt Large and Gmo Emerging Markets in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gmo Emerging Markets and Federated Mdt 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 Federated Mdt Large are associated (or correlated) with Gmo Emerging. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gmo Emerging Markets has no effect on the direction of Federated Mdt i.e., Federated Mdt and Gmo Emerging go up and down completely randomly.
Pair Corralation between Federated Mdt and Gmo Emerging
Assuming the 90 days horizon Federated Mdt is expected to generate 1.34 times less return on investment than Gmo Emerging. In addition to that, Federated Mdt is 1.08 times more volatile than Gmo Emerging Markets. It trades about 0.16 of its total potential returns per unit of risk. Gmo Emerging Markets is currently generating about 0.23 per unit of volatility. If you would invest 2,548 in Gmo Emerging Markets on June 3, 2025 and sell it today you would earn a total of 279.00 from holding Gmo Emerging Markets or generate 10.95% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Federated Mdt Large vs. Gmo Emerging Markets
Performance |
| Timeline |
| Federated Mdt Large |
| Gmo Emerging Markets |
Federated Mdt and Gmo Emerging Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Federated Mdt and Gmo Emerging
The main advantage of trading using opposite Federated Mdt and Gmo Emerging positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Federated Mdt position performs unexpectedly, Gmo Emerging 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 Gmo Emerging will offset losses from the drop in Gmo Emerging's long position.| Federated Mdt vs. Harding Loevner Emerging | Federated Mdt vs. Ashmore Emerging Markets | Federated Mdt vs. Angel Oak Multi Strategy | Federated Mdt vs. Rbc Emerging Markets |
| Gmo Emerging vs. Ab Bond Inflation | Gmo Emerging vs. Ab Bond Inflation | Gmo Emerging vs. Ab Bond Inflation | Gmo Emerging vs. Goldman Sachs Inflation |
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 Stocks Directory module to find actively traded stocks across global markets.
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