Correlation Between Ab New and Thornburg New
Can any of the company-specific risk be diversified away by investing in both Ab New and Thornburg New 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 New and Thornburg New into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ab New York and Thornburg New York, you can compare the effects of market volatilities on Ab New and Thornburg New 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 New with a short position of Thornburg New. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ab New and Thornburg New.
Diversification Opportunities for Ab New and Thornburg New
0.93 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between ANYCX and Thornburg is 0.93. Overlapping area represents the amount of risk that can be diversified away by holding Ab New York and Thornburg New York in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Thornburg New York and Ab New 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 New York are associated (or correlated) with Thornburg New. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Thornburg New York has no effect on the direction of Ab New i.e., Ab New and Thornburg New go up and down completely randomly.
Pair Corralation between Ab New and Thornburg New
Assuming the 90 days horizon Ab New York is expected to generate 1.43 times more return on investment than Thornburg New. However, Ab New is 1.43 times more volatile than Thornburg New York. It trades about 0.07 of its potential returns per unit of risk. Thornburg New York is currently generating about 0.1 per unit of risk. If you would invest 891.00 in Ab New York on September 12, 2024 and sell it today you would earn a total of 52.00 from holding Ab New York or generate 5.84% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ab New York vs. Thornburg New York
Performance |
| Timeline |
| Ab New York |
| Thornburg New York |
Ab New and Thornburg New Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ab New and Thornburg New
The main advantage of trading using opposite Ab New and Thornburg New positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ab New position performs unexpectedly, Thornburg New 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 Thornburg New will offset losses from the drop in Thornburg New's long position.| Ab New vs. Lord Abbett Diversified | Ab New vs. Pioneer Diversified High | Ab New vs. Pgim Jennison Diversified | Ab New vs. Fidelity Advisor Diversified |
| Thornburg New vs. Kinetics Small Cap | Thornburg New vs. Ab Small Cap | Thornburg New vs. Ab Small Cap | Thornburg New vs. Smallcap Growth 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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
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