Correlation Between Ab Global and The Gold
Can any of the company-specific risk be diversified away by investing in both Ab Global and The Gold 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 The Gold 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 The Gold Bullion, you can compare the effects of market volatilities on Ab Global and The Gold 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 The Gold. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ab Global and The Gold.
Diversification Opportunities for Ab Global and The Gold
Good diversification
The 3 months correlation between ANAZX and The is -0.08. Overlapping area represents the amount of risk that can be diversified away by holding Ab Global Bond and The Gold Bullion in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gold Bullion 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 The Gold. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gold Bullion has no effect on the direction of Ab Global i.e., Ab Global and The Gold go up and down completely randomly.
Pair Corralation between Ab Global and The Gold
Assuming the 90 days horizon Ab Global is expected to generate 17.95 times less return on investment than The Gold. But when comparing it to its historical volatility, Ab Global Bond is 2.84 times less risky than The Gold. It trades about 0.06 of its potential returns per unit of risk. The Gold Bullion is currently generating about 0.37 of returns per unit of risk over similar time horizon. If you would invest 1,983 in The Gold Bullion on October 25, 2024 and sell it today you would earn a total of 108.00 from holding The Gold Bullion or generate 5.45% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ab Global Bond vs. The Gold Bullion
Performance |
| Timeline |
| Ab Global Bond |
| Gold Bullion |
Ab Global and The Gold Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ab Global and The Gold
The main advantage of trading using opposite Ab Global and The Gold positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ab Global position performs unexpectedly, The Gold 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 The Gold will offset losses from the drop in The Gold's long position.| Ab Global vs. Ashmore Emerging Markets | Ab Global vs. Aqr Sustainable Long Short | Ab Global vs. Sp Midcap Index | Ab Global vs. Saat Market Growth |
| The Gold vs. Schwab Government Money | The Gold vs. Elfun Government Money | The Gold vs. Edward Jones Money | The Gold vs. Hewitt Money Market |
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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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