Correlation Between Ab Bond and Multi Manager
Can any of the company-specific risk be diversified away by investing in both Ab Bond and Multi Manager 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 Bond and Multi Manager into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ab Bond Inflation and Multi Manager Directional Alternative, you can compare the effects of market volatilities on Ab Bond and Multi Manager 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 Bond with a short position of Multi Manager. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ab Bond and Multi Manager.
Diversification Opportunities for Ab Bond and Multi Manager
-0.56 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between ABNTX and Multi is -0.56. Overlapping area represents the amount of risk that can be diversified away by holding Ab Bond Inflation and Multi Manager Directional Alte in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Multi Manager Direct and Ab Bond 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 Bond Inflation are associated (or correlated) with Multi Manager. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Multi Manager Direct has no effect on the direction of Ab Bond i.e., Ab Bond and Multi Manager go up and down completely randomly.
Pair Corralation between Ab Bond and Multi Manager
Assuming the 90 days horizon Ab Bond is expected to generate 31.76 times less return on investment than Multi Manager. But when comparing it to its historical volatility, Ab Bond Inflation is 6.27 times less risky than Multi Manager. It trades about 0.05 of its potential returns per unit of risk. Multi Manager Directional Alternative is currently generating about 0.27 of returns per unit of risk over similar time horizon. If you would invest 778.00 in Multi Manager Directional Alternative on August 30, 2024 and sell it today you would earn a total of 50.00 from holding Multi Manager Directional Alternative or generate 6.43% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ab Bond Inflation vs. Multi Manager Directional Alte
Performance |
| Timeline |
| Ab Bond Inflation |
| Multi Manager Direct |
Ab Bond and Multi Manager Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ab Bond and Multi Manager
The main advantage of trading using opposite Ab Bond and Multi Manager positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ab Bond position performs unexpectedly, Multi Manager 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 Multi Manager will offset losses from the drop in Multi Manager's long position.| Ab Bond vs. Ab Global E | Ab Bond vs. Ab Global E | Ab Bond vs. Ab Global E | Ab Bond vs. Ab Minnesota Portfolio |
| Multi Manager vs. Ab Bond Inflation | Multi Manager vs. Dreyfusstandish Global Fixed | Multi Manager vs. California Bond Fund | Multi Manager vs. Icon Bond Fund |
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 Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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