Correlation Between AllianceBernstein and OFS Credit
Can any of the company-specific risk be diversified away by investing in both AllianceBernstein and OFS Credit 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 OFS Credit 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 OFS Credit, you can compare the effects of market volatilities on AllianceBernstein and OFS Credit 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 OFS Credit. Check out your portfolio center. Please also check ongoing floating volatility patterns of AllianceBernstein and OFS Credit.
Diversification Opportunities for AllianceBernstein and OFS Credit
0.79 | Correlation Coefficient |
Poor diversification
The 3 months correlation between AllianceBernstein and OFS is 0.79. Overlapping area represents the amount of risk that can be diversified away by holding AllianceBernstein Holding LP and OFS Credit in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on OFS Credit 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 OFS Credit. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of OFS Credit has no effect on the direction of AllianceBernstein i.e., AllianceBernstein and OFS Credit go up and down completely randomly.
Pair Corralation between AllianceBernstein and OFS Credit
Allowing for the 90-day total investment horizon AllianceBernstein Holding LP is expected to under-perform the OFS Credit. In addition to that, AllianceBernstein is 4.69 times more volatile than OFS Credit. It trades about -0.13 of its total potential returns per unit of risk. OFS Credit is currently generating about 0.16 per unit of volatility. If you would invest 2,354 in OFS Credit on August 28, 2024 and sell it today you would earn a total of 31.00 from holding OFS Credit or generate 1.32% 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. OFS Credit
Performance |
| Timeline |
| AllianceBernstein |
| OFS Credit |
AllianceBernstein and OFS Credit Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AllianceBernstein and OFS Credit
The main advantage of trading using opposite AllianceBernstein and OFS Credit positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AllianceBernstein position performs unexpectedly, OFS Credit 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 OFS Credit will offset losses from the drop in OFS Credit's long position.| AllianceBernstein vs. Brightsphere Investment Group | AllianceBernstein vs. Affiliated Managers Group | AllianceBernstein vs. Bain Capital Specialty | AllianceBernstein vs. BlackRock Capital Allocation |
| OFS Credit vs. Oxford Lane Capital | OFS Credit vs. XOMA Corporation | OFS Credit vs. HUMANA INC | OFS Credit vs. Aquagold International |
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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