Correlation Between Ab Bond and First Eagle
Can any of the company-specific risk be diversified away by investing in both Ab Bond and First Eagle 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 Bond and First Eagle into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ab Bond Inflation and First Eagle Global, you can compare the effects of market volatilities on Ab Bond and First Eagle 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 Bond with a short position of First Eagle. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ab Bond and First Eagle.
Diversification Opportunities for Ab Bond and First Eagle
0.74 | Correlation Coefficient |
Poor diversification
The 3 months correlation between ANBIX and First is 0.74. Overlapping area represents the amount of risk that can be diversified away by holding Ab Bond Inflation and First Eagle Global in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on First Eagle Global and Ab Bond 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 Bond Inflation are associated (or correlated) with First Eagle. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of First Eagle Global has no effect on the direction of Ab Bond i.e., Ab Bond and First Eagle go up and down completely randomly.
Pair Corralation between Ab Bond and First Eagle
Assuming the 90 days horizon Ab Bond Inflation is expected to generate 0.42 times more return on investment than First Eagle. However, Ab Bond Inflation is 2.36 times less risky than First Eagle. It trades about 0.21 of its potential returns per unit of risk. First Eagle Global is currently generating about -0.03 per unit of risk. If you would invest 1,024 in Ab Bond Inflation on September 4, 2024 and sell it today you would earn a total of 7.00 from holding Ab Bond Inflation or generate 0.68% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.24% |
| Values | Daily Returns |
Ab Bond Inflation vs. First Eagle Global
Performance |
| Timeline |
| Ab Bond Inflation |
| First Eagle Global |
Ab Bond and First Eagle Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ab Bond and First Eagle
The main advantage of trading using opposite Ab Bond and First Eagle positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ab Bond position performs unexpectedly, First Eagle 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 First Eagle will offset losses from the drop in First Eagle's long position.| Ab Bond vs. Fidelity Sai Convertible | Ab Bond vs. Putnam Convertible Incm Gwth | Ab Bond vs. Calamos Dynamic Convertible | Ab Bond vs. Advent Claymore Convertible |
| First Eagle vs. John Hancock Bond | First Eagle vs. Lord Abbett Bond | First Eagle vs. Prudential Jennison Global | First Eagle vs. Victory Sycamore Established |
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 Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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