Correlation Between Ab Impact and Federated Strategic
Can any of the company-specific risk be diversified away by investing in both Ab Impact and Federated Strategic 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 Federated Strategic 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 Federated Strategic Value, you can compare the effects of market volatilities on Ab Impact and Federated Strategic 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 Federated Strategic. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ab Impact and Federated Strategic.
Diversification Opportunities for Ab Impact and Federated Strategic
-0.04 | Correlation Coefficient |
Good diversification
The 3 months correlation between ABIMX and Federated is -0.04. Overlapping area represents the amount of risk that can be diversified away by holding Ab Impact Municipal and Federated Strategic Value in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Federated Strategic Value 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 Federated Strategic. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Federated Strategic Value has no effect on the direction of Ab Impact i.e., Ab Impact and Federated Strategic go up and down completely randomly.
Pair Corralation between Ab Impact and Federated Strategic
Assuming the 90 days horizon Ab Impact Municipal is expected to generate 0.42 times more return on investment than Federated Strategic. However, Ab Impact Municipal is 2.39 times less risky than Federated Strategic. It trades about 0.09 of its potential returns per unit of risk. Federated Strategic Value is currently generating about 0.03 per unit of risk. If you would invest 877.00 in Ab Impact Municipal on September 12, 2024 and sell it today you would earn a total of 122.00 from holding Ab Impact Municipal or generate 13.91% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ab Impact Municipal vs. Federated Strategic Value
Performance |
| Timeline |
| Ab Impact Municipal |
| Federated Strategic Value |
Ab Impact and Federated Strategic Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ab Impact and Federated Strategic
The main advantage of trading using opposite Ab Impact and Federated Strategic positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ab Impact position performs unexpectedly, Federated Strategic 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 Federated Strategic will offset losses from the drop in Federated Strategic's long position.| Ab Impact vs. SCOR PK | Ab Impact vs. Morningstar Unconstrained Allocation | Ab Impact vs. Thrivent High Yield | Ab Impact vs. Via Renewables |
| Federated Strategic vs. Ab Select Equity | Federated Strategic vs. Ab Fixed Income Shares | Federated Strategic vs. Qs Global Equity | Federated Strategic vs. Rbc Global Equity |
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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
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