Correlation Between Ab Impact and Eic Value
Can any of the company-specific risk be diversified away by investing in both Ab Impact and Eic Value 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 Ab Impact and Eic Value into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ab Impact Municipal and Eic Value Fund, you can compare the effects of market volatilities on Ab Impact and Eic Value 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 Ab Impact with a short position of Eic Value. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ab Impact and Eic Value.
Diversification Opportunities for Ab Impact and Eic Value
Significant diversification
The 3 months correlation between ABIMX and Eic is 0.03. Overlapping area represents the amount of risk that can be diversified away by holding Ab Impact Municipal and Eic Value Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eic Value Fund and Ab Impact 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 Ab Impact Municipal are associated (or correlated) with Eic Value. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Eic Value Fund has no effect on the direction of Ab Impact i.e., Ab Impact and Eic Value go up and down completely randomly.
Pair Corralation between Ab Impact and Eic Value
Assuming the 90 days horizon Ab Impact Municipal is expected to generate 0.3 times more return on investment than Eic Value. However, Ab Impact Municipal is 3.34 times less risky than Eic Value. It trades about 0.44 of its potential returns per unit of risk. Eic Value Fund is currently generating about 0.02 per unit of risk. If you would invest 984.00 in Ab Impact Municipal on September 13, 2024 and sell it today you would earn a total of 14.00 from holding Ab Impact Municipal or generate 1.42% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ab Impact Municipal vs. Eic Value Fund
Performance |
| Timeline |
| Ab Impact Municipal |
| Eic Value Fund |
Ab Impact and Eic Value Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ab Impact and Eic Value
The main advantage of trading using opposite Ab Impact and Eic Value positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ab Impact position performs unexpectedly, Eic Value 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 Eic Value will offset losses from the drop in Eic Value's long position.| Ab Impact vs. Vanguard Small Cap Value | Ab Impact vs. Heartland Value Plus | Ab Impact vs. Royce Opportunity Fund | Ab Impact vs. Great West Loomis Sayles |
| Eic Value vs. Aqr Long Short Equity | Eic Value vs. Franklin Federal Limited Term | Eic Value vs. Lord Abbett Short | Eic Value vs. Siit Ultra Short |
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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
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