Correlation Between Ab Pennsylvania and Ep Emerging
Can any of the company-specific risk be diversified away by investing in both Ab Pennsylvania and Ep Emerging 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 Pennsylvania and Ep Emerging into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ab Pennsylvania Portfolio and Ep Emerging Markets, you can compare the effects of market volatilities on Ab Pennsylvania and Ep Emerging 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 Pennsylvania with a short position of Ep Emerging. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ab Pennsylvania and Ep Emerging.
Diversification Opportunities for Ab Pennsylvania and Ep Emerging
0.31 | Correlation Coefficient |
Weak diversification
The 3 months correlation between APACX and EPEIX is 0.31. Overlapping area represents the amount of risk that can be diversified away by holding Ab Pennsylvania Portfolio and Ep Emerging Markets in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ep Emerging Markets and Ab Pennsylvania 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 Pennsylvania Portfolio are associated (or correlated) with Ep Emerging. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ep Emerging Markets has no effect on the direction of Ab Pennsylvania i.e., Ab Pennsylvania and Ep Emerging go up and down completely randomly.
Pair Corralation between Ab Pennsylvania and Ep Emerging
Assuming the 90 days horizon Ab Pennsylvania Portfolio is expected to generate 0.22 times more return on investment than Ep Emerging. However, Ab Pennsylvania Portfolio is 4.62 times less risky than Ep Emerging. It trades about 0.16 of its potential returns per unit of risk. Ep Emerging Markets is currently generating about 0.03 per unit of risk. If you would invest 950.00 in Ab Pennsylvania Portfolio on September 5, 2024 and sell it today you would earn a total of 36.00 from holding Ab Pennsylvania Portfolio or generate 3.79% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ab Pennsylvania Portfolio vs. Ep Emerging Markets
Performance |
| Timeline |
| Ab Pennsylvania Portfolio |
| Ep Emerging Markets |
Ab Pennsylvania and Ep Emerging Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ab Pennsylvania and Ep Emerging
The main advantage of trading using opposite Ab Pennsylvania and Ep Emerging positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ab Pennsylvania position performs unexpectedly, Ep Emerging 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 Ep Emerging will offset losses from the drop in Ep Emerging's long position.| Ab Pennsylvania vs. Ep Emerging Markets | Ab Pennsylvania vs. Jpmorgan Emerging Markets | Ab Pennsylvania vs. Legg Mason Partners | Ab Pennsylvania vs. Transamerica Emerging Markets |
| Ep Emerging vs. Fidelity Advisor Health | Ep Emerging vs. Prudential Health Sciences | Ep Emerging vs. Tekla Healthcare Opportunities | Ep Emerging vs. Eventide Healthcare Life |
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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
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