Correlation Between Federated Intermediate and Guidepath(r) Conservative

Can any of the company-specific risk be diversified away by investing in both Federated Intermediate and Guidepath(r) Conservative 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 Intermediate and Guidepath(r) Conservative into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Federated Intermediate Municipal and Guidepath Servative Allocation, you can compare the effects of market volatilities on Federated Intermediate and Guidepath(r) Conservative 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 Intermediate with a short position of Guidepath(r) Conservative. Check out your portfolio center. Please also check ongoing floating volatility patterns of Federated Intermediate and Guidepath(r) Conservative.

Diversification Opportunities for Federated Intermediate and Guidepath(r) Conservative

0.35

Correlation Coefficient

Federated Intermediate  Guidepath(r) Conservative

Weak diversification

The 3 months correlation between FEDERATED and Guidepath(r) is 0.35. Overlapping area represents the amount of risk that can be diversified away by holding Federated Intermediate Municip and Guidepath Servative Allocation in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guidepath(r) Conservative and Federated Intermediate 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 Intermediate Municipal are associated (or correlated) with Guidepath(r) Conservative. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guidepath(r) Conservative has no effect on the direction of Federated Intermediate i.e., Federated Intermediate and Guidepath(r) Conservative go up and down completely randomly.

Pair Corralation between Federated Intermediate and Guidepath(r) Conservative

Assuming the 90 days horizon Federated Intermediate Municipal is expected to under-perform the Guidepath(r) Conservative. But the mutual fund apears to be less risky and, when comparing its historical volatility, Federated Intermediate Municipal is 2.09 times less risky than Guidepath(r) Conservative. The mutual fund trades about -0.01 of its potential returns per unit of risk. The Guidepath Servative Allocation is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest  1,099  in Guidepath Servative Allocation on April 9, 2025 and sell it today you would earn a total of  76.00  from holding Guidepath Servative Allocation or generate 6.92% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	100.0%
Values	Daily Returns

Federated Intermediate Municip  vs.  Guidepath Servative Allocation

Federated Intermediate

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Federated Intermediate Municipal are ranked lower than 12 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong basic indicators, Federated Intermediate is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Guidepath(r) Conservative

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Guidepath Servative Allocation are ranked lower than 20 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak fundamental indicators, Guidepath(r) Conservative may actually be approaching a critical reversion point that can send shares even higher in August 2025.

Pair Trading with Federated Intermediate and Guidepath(r) Conservative

The main advantage of trading using opposite Federated Intermediate and Guidepath(r) Conservative positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Federated Intermediate position performs unexpectedly, Guidepath(r) Conservative 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 Guidepath(r) Conservative will offset losses from the drop in Guidepath(r) Conservative's long position.

The idea behind Federated Intermediate Municipal and Guidepath Servative Allocation pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.