Correlation Between Ab Impact and Invesco Senior
Can any of the company-specific risk be diversified away by investing in both Ab Impact and Invesco Senior 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 Invesco Senior 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 Invesco Senior Income, you can compare the effects of market volatilities on Ab Impact and Invesco Senior 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 Invesco Senior. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ab Impact and Invesco Senior.
Diversification Opportunities for Ab Impact and Invesco Senior
0.27 | Correlation Coefficient |
Modest diversification
The 3 months correlation between ABIMX and Invesco is 0.27. Overlapping area represents the amount of risk that can be diversified away by holding Ab Impact Municipal and Invesco Senior Income in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Invesco Senior Income 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 Invesco Senior. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Invesco Senior Income has no effect on the direction of Ab Impact i.e., Ab Impact and Invesco Senior go up and down completely randomly.
Pair Corralation between Ab Impact and Invesco Senior
Assuming the 90 days horizon Ab Impact Municipal is expected to generate 1.41 times more return on investment than Invesco Senior. However, Ab Impact is 1.41 times more volatile than Invesco Senior Income. It trades about 0.2 of its potential returns per unit of risk. Invesco Senior Income is currently generating about -0.04 per unit of risk. If you would invest 985.00 in Ab Impact Municipal on September 5, 2024 and sell it today you would earn a total of 16.00 from holding Ab Impact Municipal or generate 1.62% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ab Impact Municipal vs. Invesco Senior Income
Performance |
| Timeline |
| Ab Impact Municipal |
| Invesco Senior Income |
Ab Impact and Invesco Senior Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ab Impact and Invesco Senior
The main advantage of trading using opposite Ab Impact and Invesco Senior positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ab Impact position performs unexpectedly, Invesco Senior 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 Invesco Senior will offset losses from the drop in Invesco Senior's long position.| Ab Impact vs. Deutsche Real Estate | Ab Impact vs. Columbia Real Estate | Ab Impact vs. Vanguard Reit Index | Ab Impact vs. Real Estate Ultrasector |
| Invesco Senior vs. Ab Impact Municipal | Invesco Senior vs. Legg Mason Partners | Invesco Senior vs. Lind Capital Partners | Invesco Senior vs. Limited Term Tax |
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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
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