Correlation Between Abbey Capital and Arrow Managed
Can any of the company-specific risk be diversified away by investing in both Abbey Capital and Arrow Managed 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 Abbey Capital and Arrow Managed into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Abbey Capital Futures and Arrow Managed Futures, you can compare the effects of market volatilities on Abbey Capital and Arrow Managed 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 Abbey Capital with a short position of Arrow Managed. Check out your portfolio center. Please also check ongoing floating volatility patterns of Abbey Capital and Arrow Managed.
Diversification Opportunities for Abbey Capital and Arrow Managed
0.92 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Abbey and Arrow is 0.92. Overlapping area represents the amount of risk that can be diversified away by holding Abbey Capital Futures and Arrow Managed Futures in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Arrow Managed Futures and Abbey Capital 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 Abbey Capital Futures are associated (or correlated) with Arrow Managed. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Arrow Managed Futures has no effect on the direction of Abbey Capital i.e., Abbey Capital and Arrow Managed go up and down completely randomly.
Pair Corralation between Abbey Capital and Arrow Managed
Assuming the 90 days horizon Abbey Capital is expected to generate 8.41 times less return on investment than Arrow Managed. But when comparing it to its historical volatility, Abbey Capital Futures is 2.62 times less risky than Arrow Managed. It trades about 0.07 of its potential returns per unit of risk. Arrow Managed Futures is currently generating about 0.23 of returns per unit of risk over similar time horizon. If you would invest 540.00 in Arrow Managed Futures on September 2, 2024 and sell it today you would earn a total of 30.00 from holding Arrow Managed Futures or generate 5.56% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Abbey Capital Futures vs. Arrow Managed Futures
Performance |
| Timeline |
| Abbey Capital Futures |
| Arrow Managed Futures |
Abbey Capital and Arrow Managed Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Abbey Capital and Arrow Managed
The main advantage of trading using opposite Abbey Capital and Arrow Managed positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Abbey Capital position performs unexpectedly, Arrow Managed 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 Arrow Managed will offset losses from the drop in Arrow Managed's long position.| Abbey Capital vs. Ab Bond Inflation | Abbey Capital vs. The Hartford Inflation | Abbey Capital vs. Aqr Managed Futures | Abbey Capital vs. Nationwide Inflation Protected Securities |
| Arrow Managed vs. Arrow Dwa Tactical | Arrow Managed vs. Arrow Dwa Tactical | Arrow Managed vs. Vanguard 500 Index | Arrow Managed vs. Allspring Global Dividend |
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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
Other Complementary Tools
| Pair Correlation Compare performance and examine fundamental relationship between any two equity instruments | |
| Portfolio Dashboard Portfolio dashboard that provides centralized access to all your investments | |
| Pattern Recognition Use different Pattern Recognition models to time the market across multiple global exchanges | |
| Instant Ratings Determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| AI Portfolio Architect Use AI to generate optimal portfolios and find profitable investment opportunities |