Correlation Between Aberden Emerng and American Funds
Can any of the company-specific risk be diversified away by investing in both Aberden Emerng and American Funds 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 Aberden Emerng and American Funds into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Aberden Emerng Mrkts and American Funds Inflation, you can compare the effects of market volatilities on Aberden Emerng and American Funds 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 Aberden Emerng with a short position of American Funds. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aberden Emerng and American Funds.
Diversification Opportunities for Aberden Emerng and American Funds
0.38 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Aberden and American is 0.38. Overlapping area represents the amount of risk that can be diversified away by holding Aberden Emerng Mrkts and American Funds Inflation in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on American Funds Inflation and Aberden Emerng 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 Aberden Emerng Mrkts are associated (or correlated) with American Funds. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of American Funds Inflation has no effect on the direction of Aberden Emerng i.e., Aberden Emerng and American Funds go up and down completely randomly.
Pair Corralation between Aberden Emerng and American Funds
Assuming the 90 days horizon Aberden Emerng Mrkts is expected to generate 3.9 times more return on investment than American Funds. However, Aberden Emerng is 3.9 times more volatile than American Funds Inflation. It trades about 0.02 of its potential returns per unit of risk. American Funds Inflation is currently generating about 0.09 per unit of risk. If you would invest 1,341 in Aberden Emerng Mrkts on September 1, 2024 and sell it today you would earn a total of 34.00 from holding Aberden Emerng Mrkts or generate 2.54% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 99.21% |
| Values | Daily Returns |
Aberden Emerng Mrkts vs. American Funds Inflation
Performance |
| Timeline |
| Aberden Emerng Mrkts |
| American Funds Inflation |
Aberden Emerng and American Funds Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aberden Emerng and American Funds
The main advantage of trading using opposite Aberden Emerng and American Funds positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aberden Emerng position performs unexpectedly, American Funds 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 American Funds will offset losses from the drop in American Funds' long position.| Aberden Emerng vs. Fidelity Advisor 529 | Aberden Emerng vs. American Funds Inflation | Aberden Emerng vs. Nationwide Inflation Protected Securities | Aberden Emerng vs. Ab Bond Inflation |
| American Funds vs. Pace Large Growth | American Funds vs. Legg Mason Bw | American Funds vs. Tax Managed Large Cap | American Funds vs. Strategic Allocation Aggressive |
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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
Other Complementary Tools
| Portfolio Manager State of the art Portfolio Manager to monitor and improve performance of your invested capital | |
| Sync Your Broker Sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors. | |
| Global Correlations Find global opportunities by holding instruments from different markets | |
| Equity Valuation Check real value of public entities based on technical and fundamental data | |
| Portfolio Dashboard Portfolio dashboard that provides centralized access to all your investments |