Correlation Between American Beacon and Rbc Bluebay
Can any of the company-specific risk be diversified away by investing in both American Beacon and Rbc Bluebay 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 American Beacon and Rbc Bluebay into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between American Beacon Intl and Rbc Bluebay Global, you can compare the effects of market volatilities on American Beacon and Rbc Bluebay 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 American Beacon with a short position of Rbc Bluebay. Check out your portfolio center. Please also check ongoing floating volatility patterns of American Beacon and Rbc Bluebay.
Diversification Opportunities for American Beacon and Rbc Bluebay
-0.27 | Correlation Coefficient |
Very good diversification
The 3 months correlation between American and Rbc is -0.27. Overlapping area represents the amount of risk that can be diversified away by holding American Beacon Intl and Rbc Bluebay Global in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Rbc Bluebay Global and American Beacon 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 American Beacon Intl are associated (or correlated) with Rbc Bluebay. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Rbc Bluebay Global has no effect on the direction of American Beacon i.e., American Beacon and Rbc Bluebay go up and down completely randomly.
Pair Corralation between American Beacon and Rbc Bluebay
Assuming the 90 days horizon American Beacon Intl is expected to generate 4.32 times more return on investment than Rbc Bluebay. However, American Beacon is 4.32 times more volatile than Rbc Bluebay Global. It trades about 0.33 of its potential returns per unit of risk. Rbc Bluebay Global is currently generating about 0.29 per unit of risk. If you would invest 1,494 in American Beacon Intl on November 3, 2024 and sell it today you would earn a total of 90.00 from holding American Beacon Intl or generate 6.02% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
American Beacon Intl vs. Rbc Bluebay Global
Performance |
| Timeline |
| American Beacon Intl |
| Rbc Bluebay Global |
American Beacon and Rbc Bluebay Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with American Beacon and Rbc Bluebay
The main advantage of trading using opposite American Beacon and Rbc Bluebay positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if American Beacon position performs unexpectedly, Rbc Bluebay 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 Rbc Bluebay will offset losses from the drop in Rbc Bluebay's long position.| American Beacon vs. Madison Diversified Income | American Beacon vs. Delaware Limited Term Diversified | American Beacon vs. Fulcrum Diversified Absolute | American Beacon vs. Allianzgi Diversified Income |
| Rbc Bluebay vs. Jpmorgan Income Fund | Rbc Bluebay vs. Prudential High Yield | Rbc Bluebay vs. Parametric Modity Strategy | Rbc Bluebay vs. Prudential Floating Rate |
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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
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