PORTFOLIO RISK
Correlation
Standardizes co-movement between two return series.
Formula
ρ_xy = Cov(X,Y)/(σ_xσ_y)
Variables: Covariance; standard deviations
What it means
Standardizes co-movement between two return series.
Example
Correlation near +1 indicates strong positive linear co-movement; near -1 indicates strong negative co-movement.
How to interpret it
This concept should be read together with its market convention, measurement horizon and underlying instrument. BondStats presents it as an analytical reference rather than investment advice; instrument documentation and primary market rules remain authoritative.
Related Formulas
BondStats reference content is independently written. Mathematical relationships, abbreviations and market conventions are presented for educational and analytical use.