Correlation Between Rbc Bluebay and Vanguard Extended
Can any of the company-specific risk be diversified away by investing in both Rbc Bluebay and Vanguard Extended 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 Rbc Bluebay and Vanguard Extended into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Rbc Bluebay Emerging and Vanguard Extended Market, you can compare the effects of market volatilities on Rbc Bluebay and Vanguard Extended 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 Rbc Bluebay with a short position of Vanguard Extended. Check out your portfolio center. Please also check ongoing floating volatility patterns of Rbc Bluebay and Vanguard Extended.
Diversification Opportunities for Rbc Bluebay and Vanguard Extended
0.92 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between RBC and Vanguard is 0.92. Overlapping area represents the amount of risk that can be diversified away by holding Rbc Bluebay Emerging and Vanguard Extended Market in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Vanguard Extended Market and Rbc Bluebay 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 Rbc Bluebay Emerging are associated (or correlated) with Vanguard Extended. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Vanguard Extended Market has no effect on the direction of Rbc Bluebay i.e., Rbc Bluebay and Vanguard Extended go up and down completely randomly.
Pair Corralation between Rbc Bluebay and Vanguard Extended
Assuming the 90 days horizon Rbc Bluebay is expected to generate 1.65 times less return on investment than Vanguard Extended. But when comparing it to its historical volatility, Rbc Bluebay Emerging is 3.61 times less risky than Vanguard Extended. It trades about 0.13 of its potential returns per unit of risk. Vanguard Extended Market is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 27,231 in Vanguard Extended Market on June 3, 2025 and sell it today you would earn a total of 11,291 from holding Vanguard Extended Market or generate 41.46% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Rbc Bluebay Emerging vs. Vanguard Extended Market
Performance |
| Timeline |
| Rbc Bluebay Emerging |
| Vanguard Extended Market |
Rbc Bluebay and Vanguard Extended Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Rbc Bluebay and Vanguard Extended
The main advantage of trading using opposite Rbc Bluebay and Vanguard Extended positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Rbc Bluebay position performs unexpectedly, Vanguard Extended 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 Vanguard Extended will offset losses from the drop in Vanguard Extended's long position.| Rbc Bluebay vs. Aqr Diversified Arbitrage | Rbc Bluebay vs. Jpmorgan Diversified Fund | Rbc Bluebay vs. Victory Diversified Stock | Rbc Bluebay vs. Elfun Diversified Fund |
| Vanguard Extended vs. Vanguard Global Equity | Vanguard Extended vs. Vanguard Explorer Fund | Vanguard Extended vs. Vanguard Selected Value | Vanguard Extended vs. Vanguard Windsor Ii |
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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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