Correlation Between Ab Bond and Grant Park
Can any of the company-specific risk be diversified away by investing in both Ab Bond and Grant Park 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 Grant Park 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 Grant Park Multi, you can compare the effects of market volatilities on Ab Bond and Grant Park 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 Grant Park. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ab Bond and Grant Park.
Diversification Opportunities for Ab Bond and Grant Park
0.83 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between ANBIX and Grant is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding Ab Bond Inflation and Grant Park Multi in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Grant Park Multi 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 Grant Park. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Grant Park Multi has no effect on the direction of Ab Bond i.e., Ab Bond and Grant Park go up and down completely randomly.
Pair Corralation between Ab Bond and Grant Park
Assuming the 90 days horizon Ab Bond Inflation is expected to generate 0.72 times more return on investment than Grant Park. However, Ab Bond Inflation is 1.39 times less risky than Grant Park. It trades about 0.07 of its potential returns per unit of risk. Grant Park Multi is currently generating about 0.02 per unit of risk. If you would invest 939.00 in Ab Bond Inflation on September 12, 2024 and sell it today you would earn a total of 89.00 from holding Ab Bond Inflation or generate 9.48% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ab Bond Inflation vs. Grant Park Multi
Performance |
| Timeline |
| Ab Bond Inflation |
| Grant Park Multi |
Ab Bond and Grant Park Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ab Bond and Grant Park
The main advantage of trading using opposite Ab Bond and Grant Park positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ab Bond position performs unexpectedly, Grant Park 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 Grant Park will offset losses from the drop in Grant Park's long position.| Ab Bond vs. SCOR PK | Ab Bond vs. Morningstar Unconstrained Allocation | Ab Bond vs. Thrivent High Yield | Ab Bond vs. Via Renewables |
| Grant Park vs. T Rowe Price | Grant Park vs. Ab Bond Inflation | Grant Park vs. Doubleline Yield Opportunities | Grant Park vs. California Bond Fund |
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 CEOs Directory module to screen CEOs from public companies around the world.
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