Correlation Between Ab Value and Emerging Markets
Can any of the company-specific risk be diversified away by investing in both Ab Value and Emerging Markets 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 Emerging Markets 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 Emerging Markets Bond, you can compare the effects of market volatilities on Ab Value and Emerging Markets 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 Emerging Markets. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ab Value and Emerging Markets.
Diversification Opportunities for Ab Value and Emerging Markets
-0.14 | Correlation Coefficient |
Good diversification
The 3 months correlation between ABVCX and Emerging is -0.14. Overlapping area represents the amount of risk that can be diversified away by holding Ab Value Fund and Emerging Markets Bond in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Emerging Markets Bond 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 Emerging Markets. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Emerging Markets Bond has no effect on the direction of Ab Value i.e., Ab Value and Emerging Markets go up and down completely randomly.
Pair Corralation between Ab Value and Emerging Markets
Assuming the 90 days horizon Ab Value Fund is expected to generate 2.1 times more return on investment than Emerging Markets. However, Ab Value is 2.1 times more volatile than Emerging Markets Bond. It trades about 0.13 of its potential returns per unit of risk. Emerging Markets Bond is currently generating about 0.19 per unit of risk. If you would invest 1,583 in Ab Value Fund on September 4, 2024 and sell it today you would earn a total of 493.00 from holding Ab Value Fund or generate 31.14% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ab Value Fund vs. Emerging Markets Bond
Performance |
| Timeline |
| Ab Value Fund |
| Emerging Markets Bond |
Ab Value and Emerging Markets Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ab Value and Emerging Markets
The main advantage of trading using opposite Ab Value and Emerging Markets positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ab Value position performs unexpectedly, Emerging Markets 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 Emerging Markets will offset losses from the drop in Emerging Markets' long position.| Ab Value vs. Balanced Fund Investor | Ab Value vs. T Rowe Price | Ab Value vs. Ab Small Cap | Ab Value vs. Qs Growth Fund |
| Emerging Markets vs. Pimco Rae Worldwide | Emerging Markets vs. Pimco Rae Worldwide | Emerging Markets vs. Pimco Rae Worldwide | Emerging Markets vs. Pimco Rae Worldwide |
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 CEOs Directory module to screen CEOs from public companies around the world.
Other Complementary Tools
| Investing Opportunities Build portfolios using our predefined set of ideas and optimize them against your investing preferences | |
| Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings | |
| Companies Directory Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals | |
| Latest Portfolios Quick portfolio dashboard that showcases your latest portfolios | |
| Portfolio Rebalancing Analyze risk-adjusted returns against different time horizons to find asset-allocation targets |