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More than one Y Axis, for correlation study

Questions on using, creating, or understanding data in Fund Manager graphs.

Postby Djobydjoba » Sun Feb 02, 2020 11:32 am

Just for the record, another article about divergence/convergence strategies using correlation:
https://forexop.com/strategy/intermarket-analysis/

This is another illustration of the widespread use and usefulness of this correlation graph type with a dual Y-Axis and the bottom part that shows the variation of the correlation over time.

Would be great if this graph type could be added in a future update of FM!
Djobydjoba
 
Posts: 710
Joined: Tue Mar 09, 2010 9:39 am

Postby Mark » Mon Feb 03, 2020 8:30 am

Hi Djobydjoba,

Thanks for the article and feature feedback.
Thanks,
Mark
Fund Manager - Portfolio Management Software
Mark
Site Admin
 
Posts: 11252
Joined: Thu Oct 25, 2007 2:24 pm
Location: Chandler, AZ

Postby Djobydjoba » Sun Nov 12, 2023 4:41 am

Hi Mark,

I'm still very interested in a better way to compare graphically the correlation between 2 (or more) investments. I've added in Fund Manager a lot a special investments that are economic indicators, or calculated investments, to help analyze markets and forecast future trends, and I need an more efficient way to study the correlation between these indicators and standard investments like stock indexes.

In this context and as discussed before, the Investment Overlay graph type, with its current "performance mode" (comparison of the evolution in %) is not suitable.

An example: it is given that there is a quite significant correlation between the EUR/USD exchange rate and the spread 2 Year Germany bond yield minus 2 Year U.S. bond yield. But this correlation can't be analyzed properly with the Investment Overlay graph type because here is the result:

https://i.ibb.co/YDWTzkj/20231112-dim-12h20-01.png

Another example, if you want to study the correlation between a stock index and an exchange rate, it's often impossible:

https://i.ibb.co/B49mnXY/20231112-dim-12h22-01.png


So currently I think the only way is to display two graph windows one above the other but is is not very handy nor optimal when you have to do this regularly.

https://i.ibb.co/fCnwVc6/20231112-dim-12h13-01.png

Probably my initial 2 Y-Axis request would be too complicated to implement and to use in the program.

But what you had suggested above would be I think a very good solution, a very useful feature and that would be great if it could be added:

Another option would be to add a mode to the Investment Overlay graph such that all plotted lines were not on the same % scale. Each line would still be normalized to 100% at the beginning of the graph date range, but the scale could be set independent for each investment such that each investment reaches the max/min Y axis. There would basically be no Y axis labels, as they would each be at a different scale, but could be useful for a "correlation" mode, as opposed to a "performance comparison" mode which is currently how these operate.


Having the correlation coefficients displayed on the graph, for the date range selected, could be great too. Could be the correlation coefficients for the non scrollable investments, calculated with reference to the investment on the "scrolling position" (i.e.. which has its label on the left side of the legend).

Thanks.
Djobydjoba
 
Posts: 710
Joined: Tue Mar 09, 2010 9:39 am

Postby Mark » Mon Nov 13, 2023 3:48 pm

Hi Djobydjoba,

Okay, understood, sorry we haven't been able to implement this yet. It is still on the list to consider...
Thanks,
Mark
Fund Manager - Portfolio Management Software
Mark
Site Admin
 
Posts: 11252
Joined: Thu Oct 25, 2007 2:24 pm
Location: Chandler, AZ

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