Correlation Between Ab Select and Federated Short-intermedia
Can any of the company-specific risk be diversified away by investing in both Ab Select and Federated Short-intermedia 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 Select and Federated Short-intermedia into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ab Select Longshort and Federated Short Intermediate Duration, you can compare the effects of market volatilities on Ab Select and Federated Short-intermedia 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 Select with a short position of Federated Short-intermedia. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ab Select and Federated Short-intermedia.
Diversification Opportunities for Ab Select and Federated Short-intermedia
-0.09 | Correlation Coefficient |
Good diversification
The 3 months correlation between ASCLX and FEDERATED is -0.09. Overlapping area represents the amount of risk that can be diversified away by holding Ab Select Longshort and Federated Short Intermediate D in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Federated Short-intermedia and Ab Select 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 Select Longshort are associated (or correlated) with Federated Short-intermedia. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Federated Short-intermedia has no effect on the direction of Ab Select i.e., Ab Select and Federated Short-intermedia go up and down completely randomly.
Pair Corralation between Ab Select and Federated Short-intermedia
Assuming the 90 days horizon Ab Select Longshort is expected to generate 3.99 times more return on investment than Federated Short-intermedia. However, Ab Select is 3.99 times more volatile than Federated Short Intermediate Duration. It trades about 0.2 of its potential returns per unit of risk. Federated Short Intermediate Duration is currently generating about 0.15 per unit of risk. If you would invest 1,369 in Ab Select Longshort on August 29, 2024 and sell it today you would earn a total of 38.00 from holding Ab Select Longshort or generate 2.78% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ab Select Longshort vs. Federated Short Intermediate D
Performance |
| Timeline |
| Ab Select Longshort |
| Federated Short-intermedia |
Ab Select and Federated Short-intermedia Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ab Select and Federated Short-intermedia
The main advantage of trading using opposite Ab Select and Federated Short-intermedia positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ab Select position performs unexpectedly, Federated Short-intermedia 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 Federated Short-intermedia will offset losses from the drop in Federated Short-intermedia's long position.| Ab Select vs. Neuberger Berman Long | Ab Select vs. Neuberger Berman Long | Ab Select vs. Diamond Hill Long Short | Ab Select vs. Pimco Rae Worldwide |
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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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