Correlation Between AllianceBernstein and International General
Can any of the company-specific risk be diversified away by investing in both AllianceBernstein and International General 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 International General 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 International General Insurance, you can compare the effects of market volatilities on AllianceBernstein and International General 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 International General. Check out your portfolio center. Please also check ongoing floating volatility patterns of AllianceBernstein and International General.
Diversification Opportunities for AllianceBernstein and International General
0.68 | Correlation Coefficient |
Poor diversification
The 3 months correlation between AllianceBernstein and International is 0.68. Overlapping area represents the amount of risk that can be diversified away by holding AllianceBernstein Holding LP and International General Insuranc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on International General 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 International General. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of International General has no effect on the direction of AllianceBernstein i.e., AllianceBernstein and International General go up and down completely randomly.
Pair Corralation between AllianceBernstein and International General
Allowing for the 90-day total investment horizon AllianceBernstein is expected to generate 10.8 times less return on investment than International General. But when comparing it to its historical volatility, AllianceBernstein Holding LP is 1.21 times less risky than International General. It trades about 0.02 of its potential returns per unit of risk. International General Insurance is currently generating about 0.14 of returns per unit of risk over similar time horizon. If you would invest 742.00 in International General Insurance on August 27, 2024 and sell it today you would earn a total of 1,856 from holding International General Insurance or generate 250.13% 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. International General Insuranc
Performance |
| Timeline |
| AllianceBernstein |
| International General |
AllianceBernstein and International General Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AllianceBernstein and International General
The main advantage of trading using opposite AllianceBernstein and International General positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AllianceBernstein position performs unexpectedly, International General 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 International General will offset losses from the drop in International General's long position.| AllianceBernstein vs. Brightsphere Investment Group | AllianceBernstein vs. Affiliated Managers Group | AllianceBernstein vs. Bain Capital Specialty | AllianceBernstein vs. BlackRock Capital Allocation |
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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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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