Correlation Between Ab Global and Payden Floating
Can any of the company-specific risk be diversified away by investing in both Ab Global and Payden Floating 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 Global and Payden Floating into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ab Global Bond and Payden Floating Rate, you can compare the effects of market volatilities on Ab Global and Payden Floating 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 Global with a short position of Payden Floating. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ab Global and Payden Floating.
Diversification Opportunities for Ab Global and Payden Floating
-0.75 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between ANAGX and Payden is -0.75. Overlapping area represents the amount of risk that can be diversified away by holding Ab Global Bond and Payden Floating Rate in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Payden Floating Rate and Ab Global 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 Global Bond are associated (or correlated) with Payden Floating. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Payden Floating Rate has no effect on the direction of Ab Global i.e., Ab Global and Payden Floating go up and down completely randomly.
Pair Corralation between Ab Global and Payden Floating
Assuming the 90 days horizon Ab Global Bond is expected to generate 1.16 times more return on investment than Payden Floating. However, Ab Global is 1.16 times more volatile than Payden Floating Rate. It trades about 0.28 of its potential returns per unit of risk. Payden Floating Rate is currently generating about 0.03 per unit of risk. If you would invest 689.00 in Ab Global Bond on September 13, 2024 and sell it today you would earn a total of 7.00 from holding Ab Global Bond or generate 1.02% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ab Global Bond vs. Payden Floating Rate
Performance |
| Timeline |
| Ab Global Bond |
| Payden Floating Rate |
Ab Global and Payden Floating Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ab Global and Payden Floating
The main advantage of trading using opposite Ab Global and Payden Floating positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ab Global position performs unexpectedly, Payden Floating 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 Payden Floating will offset losses from the drop in Payden Floating's long position.| Ab Global vs. Qs Global Equity | Ab Global vs. Touchstone International Equity | Ab Global vs. Rbc Global Equity | Ab Global vs. Ab Select Equity |
| Payden Floating vs. Bbh Intermediate Municipal | Payden Floating vs. Ambrus Core Bond | Payden Floating vs. Ab Global Bond | Payden Floating vs. Morningstar Defensive Bond |
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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
Other Complementary Tools
| Portfolio Volatility Check portfolio volatility and analyze historical return density to properly model market risk | |
| Theme Ratings Determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings | |
| Idea Optimizer Use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio | |
| Balance Of Power Check stock momentum by analyzing Balance Of Power indicator and other technical ratios |