Correlation Between Federated Real and Federated
Can any of the company-specific risk be diversified away by investing in both Federated Real and Federated 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 Real and Federated into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Federated Real Return and Federated Gov Sec, you can compare the effects of market volatilities on Federated Real and Federated 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 Real with a short position of Federated. Check out your portfolio center. Please also check ongoing floating volatility patterns of Federated Real and Federated.
Diversification Opportunities for Federated Real and Federated
0.82 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Federated and Federated is 0.82. Overlapping area represents the amount of risk that can be diversified away by holding Federated Real Return and Federated Gov Sec in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Federated Gov Sec and Federated Real 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 Real Return are associated (or correlated) with Federated. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Federated Gov Sec has no effect on the direction of Federated Real i.e., Federated Real and Federated go up and down completely randomly.
Pair Corralation between Federated Real and Federated
Assuming the 90 days horizon Federated Real Return is expected to generate 1.98 times more return on investment than Federated. However, Federated Real is 1.98 times more volatile than Federated Gov Sec. It trades about 0.03 of its potential returns per unit of risk. Federated Gov Sec is currently generating about 0.0 per unit of risk. If you would invest 954.00 in Federated Real Return on April 26, 2025 and sell it today you would earn a total of 1.00 from holding Federated Real Return or generate 0.1% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Federated Real Return vs. Federated Gov Sec
Performance |
| Timeline |
| Federated Real Return |
| Federated Gov Sec |
Federated Real and Federated Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Federated Real and Federated
The main advantage of trading using opposite Federated Real and Federated positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Federated Real position performs unexpectedly, Federated 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 Federated will offset losses from the drop in Federated's long position.| Federated Real vs. Scharf Global Opportunity | Federated Real vs. Fbanjx | Federated Real vs. Fkhemx | Federated Real vs. Wmcanx |
| Federated vs. Federated U S | Federated vs. Federated Mdt Large | Federated vs. Federated Total Return | Federated vs. Federated Max Cap Index |
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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
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