Correlation Between AllianceBernstein and Capital Southwest
Can any of the company-specific risk be diversified away by investing in both AllianceBernstein and Capital Southwest 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 AllianceBernstein and Capital Southwest into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AllianceBernstein Holding LP and Capital Southwest, you can compare the effects of market volatilities on AllianceBernstein and Capital Southwest 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 AllianceBernstein with a short position of Capital Southwest. Check out your portfolio center. Please also check ongoing floating volatility patterns of AllianceBernstein and Capital Southwest.
Diversification Opportunities for AllianceBernstein and Capital Southwest
0.75 | Correlation Coefficient |
Poor diversification
The 3 months correlation between AllianceBernstein and Capital is 0.75. Overlapping area represents the amount of risk that can be diversified away by holding AllianceBernstein Holding LP and Capital Southwest in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Capital Southwest and AllianceBernstein 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 AllianceBernstein Holding LP are associated (or correlated) with Capital Southwest. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Capital Southwest has no effect on the direction of AllianceBernstein i.e., AllianceBernstein and Capital Southwest go up and down completely randomly.
Pair Corralation between AllianceBernstein and Capital Southwest
Allowing for the 90-day total investment horizon AllianceBernstein Holding LP is expected to generate 4.58 times more return on investment than Capital Southwest. However, AllianceBernstein is 4.58 times more volatile than Capital Southwest. It trades about 0.11 of its potential returns per unit of risk. Capital Southwest is currently generating about 0.11 per unit of risk. If you would invest 3,417 in AllianceBernstein Holding LP on August 31, 2024 and sell it today you would earn a total of 250.00 from holding AllianceBernstein Holding LP or generate 7.32% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
AllianceBernstein Holding LP vs. Capital Southwest
Performance |
| Timeline |
| AllianceBernstein |
| Capital Southwest |
AllianceBernstein and Capital Southwest Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AllianceBernstein and Capital Southwest
The main advantage of trading using opposite AllianceBernstein and Capital Southwest positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AllianceBernstein position performs unexpectedly, Capital Southwest 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 Capital Southwest will offset losses from the drop in Capital Southwest's long position.| AllianceBernstein vs. Brightsphere Investment Group | AllianceBernstein vs. Affiliated Managers Group | AllianceBernstein vs. Bain Capital Specialty | AllianceBernstein vs. BlackRock Capital Allocation |
| Capital Southwest vs. Constellation Brands Class | Capital Southwest vs. Anheuser Busch Inbev | Capital Southwest vs. Meiwu Technology Co | Capital Southwest vs. Kaltura |
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 Commodity Directory module to find actively traded commodities issued by global exchanges.
Other Complementary Tools
| Correlation Analysis Reduce portfolio risk simply by holding instruments which are not perfectly correlated | |
| Sectors List of equity sectors categorizing publicly traded companies based on their primary business activities | |
| Positions Ratings Determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Headlines Timeline Stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity | |
| Portfolio Comparator Compare the composition, asset allocations and performance of any two portfolios in your account |