Correlation Between Ab Value and Boston Common
Can any of the company-specific risk be diversified away by investing in both Ab Value and Boston Common 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 Value and Boston Common into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ab Value Fund and Boston Common Esg, you can compare the effects of market volatilities on Ab Value and Boston Common 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 Value with a short position of Boston Common. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ab Value and Boston Common.
Diversification Opportunities for Ab Value and Boston Common
-0.3 | Correlation Coefficient |
Very good diversification
The 3 months correlation between ABVCX and Boston is -0.3. Overlapping area represents the amount of risk that can be diversified away by holding Ab Value Fund and Boston Common Esg in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Boston Common Esg and Ab Value 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 Value Fund are associated (or correlated) with Boston Common. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Boston Common Esg has no effect on the direction of Ab Value i.e., Ab Value and Boston Common go up and down completely randomly.
Pair Corralation between Ab Value and Boston Common
Assuming the 90 days horizon Ab Value Fund is expected to generate 0.64 times more return on investment than Boston Common. However, Ab Value Fund is 1.56 times less risky than Boston Common. It trades about -0.03 of its potential returns per unit of risk. Boston Common Esg is currently generating about -0.05 per unit of risk. If you would invest 2,010 in Ab Value Fund on September 14, 2024 and sell it today you would lose (7.00) from holding Ab Value Fund or give up 0.35% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.45% |
| Values | Daily Returns |
Ab Value Fund vs. Boston Common Esg
Performance |
| Timeline |
| Ab Value Fund |
| Boston Common Esg |
Ab Value and Boston Common Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ab Value and Boston Common
The main advantage of trading using opposite Ab Value and Boston Common positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ab Value position performs unexpectedly, Boston Common 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 Boston Common will offset losses from the drop in Boston Common's long position.| Ab Value vs. Putnam Convertible Incm Gwth | Ab Value vs. Fidelity Sai Convertible | Ab Value vs. Calamos Dynamic Convertible | Ab Value vs. Advent Claymore Convertible |
| Boston Common vs. Boston Mon Equity | Boston Common vs. Boston Mon International | Boston Common vs. Aqr Large Cap | Boston Common vs. Aggressive Investors 1 |
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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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