Correlation Between COREBRIDGE FINANCIAL and Ares Management
Can any of the company-specific risk be diversified away by investing in both COREBRIDGE FINANCIAL and Ares Management 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 COREBRIDGE FINANCIAL and Ares Management into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between COREBRIDGE FINANCIAL INC and Ares Management Corp, you can compare the effects of market volatilities on COREBRIDGE FINANCIAL and Ares Management 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 COREBRIDGE FINANCIAL with a short position of Ares Management. Check out your portfolio center. Please also check ongoing floating volatility patterns of COREBRIDGE FINANCIAL and Ares Management.
Diversification Opportunities for COREBRIDGE FINANCIAL and Ares Management
0.7 | Correlation Coefficient |
Poor diversification
The 3 months correlation between COREBRIDGE and Ares is 0.7. Overlapping area represents the amount of risk that can be diversified away by holding COREBRIDGE FINANCIAL INC and Ares Management Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ares Management Corp and COREBRIDGE FINANCIAL 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 COREBRIDGE FINANCIAL INC are associated (or correlated) with Ares Management. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ares Management Corp has no effect on the direction of COREBRIDGE FINANCIAL i.e., COREBRIDGE FINANCIAL and Ares Management go up and down completely randomly.
Pair Corralation between COREBRIDGE FINANCIAL and Ares Management
Assuming the 90 days horizon COREBRIDGE FINANCIAL INC is expected to generate 0.54 times more return on investment than Ares Management. However, COREBRIDGE FINANCIAL INC is 1.85 times less risky than Ares Management. It trades about 0.27 of its potential returns per unit of risk. Ares Management Corp is currently generating about -0.01 per unit of risk. If you would invest 2,857 in COREBRIDGE FINANCIAL INC on October 13, 2024 and sell it today you would earn a total of 163.00 from holding COREBRIDGE FINANCIAL INC or generate 5.71% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
COREBRIDGE FINANCIAL INC vs. Ares Management Corp
Performance |
| Timeline |
| COREBRIDGE FINANCIAL INC |
| Ares Management Corp |
COREBRIDGE FINANCIAL and Ares Management Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with COREBRIDGE FINANCIAL and Ares Management
The main advantage of trading using opposite COREBRIDGE FINANCIAL and Ares Management positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if COREBRIDGE FINANCIAL position performs unexpectedly, Ares Management 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 Ares Management will offset losses from the drop in Ares Management's long position.| COREBRIDGE FINANCIAL vs. Ares Management Corp | COREBRIDGE FINANCIAL vs. Superior Plus Corp | COREBRIDGE FINANCIAL vs. NMI Holdings | COREBRIDGE FINANCIAL vs. SIVERS SEMICONDUCTORS AB |
| Ares Management vs. Caseys General Stores | Ares Management vs. BURLINGTON STORES | Ares Management vs. PACIFIC ONLINE | Ares Management vs. Fast Retailing Co |
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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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