Correlation Between American Beacon and Asg Managed
Can any of the company-specific risk be diversified away by investing in both American Beacon and Asg 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 American Beacon and Asg Managed into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between American Beacon Ahl and Asg Managed Futures, you can compare the effects of market volatilities on American Beacon and Asg 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 American Beacon with a short position of Asg Managed. Check out your portfolio center. Please also check ongoing floating volatility patterns of American Beacon and Asg Managed.
Diversification Opportunities for American Beacon and Asg Managed
0.6 | Correlation Coefficient |
Poor diversification
The 3 months correlation between American and Asg is 0.6. Overlapping area represents the amount of risk that can be diversified away by holding American Beacon Ahl and Asg Managed Futures in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Asg Managed Futures and American Beacon 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 American Beacon Ahl are associated (or correlated) with Asg Managed. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Asg Managed Futures has no effect on the direction of American Beacon i.e., American Beacon and Asg Managed go up and down completely randomly.
Pair Corralation between American Beacon and Asg Managed
Assuming the 90 days horizon American Beacon Ahl is expected to generate 0.72 times more return on investment than Asg Managed. However, American Beacon Ahl is 1.39 times less risky than Asg Managed. It trades about -0.01 of its potential returns per unit of risk. Asg Managed Futures is currently generating about -0.02 per unit of risk. If you would invest 1,013 in American Beacon Ahl on October 25, 2024 and sell it today you would lose (34.00) from holding American Beacon Ahl or give up 3.36% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
American Beacon Ahl vs. Asg Managed Futures
Performance |
| Timeline |
| American Beacon Ahl |
| Asg Managed Futures |
American Beacon and Asg Managed Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with American Beacon and Asg Managed
The main advantage of trading using opposite American Beacon and Asg Managed positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if American Beacon position performs unexpectedly, Asg 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 Asg Managed will offset losses from the drop in Asg Managed's long position.| American Beacon vs. Asg Managed Futures | American Beacon vs. Pimco Trends Managed | American Beacon vs. American Beacon Ahl | American Beacon vs. Aqr Managed Futures |
| Asg Managed vs. Needham Small Cap | Asg Managed vs. Smallcap Fund Fka | Asg Managed vs. Touchstone Small Cap | Asg Managed vs. Ab Small Cap |
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 Portfolio Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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