Correlation Between Cref Inflation and Vy(r) T

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

By analyzing existing cross correlation between Cref Inflation Linked Bond and Vy T Rowe, you can compare the effects of market volatilities on Cref Inflation and Vy(r) T 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 Cref Inflation with a short position of Vy(r) T. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cref Inflation and Vy(r) T.

Diversification Opportunities for Cref Inflation and Vy(r) T

0.67

Correlation Coefficient

Cref Inflation  Vy(r) T

Poor diversification

The 3 months correlation between Cref and Vy(r) is 0.67. Overlapping area represents the amount of risk that can be diversified away by holding Cref Inflation Linked Bond and Vy T Rowe in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Vy T Rowe and Cref Inflation 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 Cref Inflation Linked Bond are associated (or correlated) with Vy(r) T. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Vy T Rowe has no effect on the direction of Cref Inflation i.e., Cref Inflation and Vy(r) T go up and down completely randomly.

Pair Corralation between Cref Inflation and Vy(r) T

Assuming the 90 days trading horizon Cref Inflation is expected to generate 11.48 times less return on investment than Vy(r) T. But when comparing it to its historical volatility, Cref Inflation Linked Bond is 5.64 times less risky than Vy(r) T. It trades about 0.18 of its potential returns per unit of risk. Vy T Rowe is currently generating about 0.36 of returns per unit of risk over similar time horizon. If you would invest  894.00  in Vy T Rowe on April 20, 2025 and sell it today you would earn a total of  255.00  from holding Vy T Rowe or generate 28.52% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	98.41%
Values	Daily Returns

Cref Inflation Linked Bond  vs.  Vy T Rowe

Cref Inflation Linked

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Cref Inflation Linked Bond are ranked lower than 14 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong forward indicators, Cref Inflation is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Vy T Rowe

Risk-Adjusted Performance

Strong

Compared to the overall equity markets, risk-adjusted returns on investments in Vy T Rowe are ranked lower than 28 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak basic indicators, Vy(r) T showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Cref Inflation and Vy(r) T

The main advantage of trading using opposite Cref Inflation and Vy(r) T positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cref Inflation position performs unexpectedly, Vy(r) T 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 Vy(r) T will offset losses from the drop in Vy(r) T's long position.

The idea behind Cref Inflation Linked Bond and Vy T Rowe 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 Portfolio Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.