Correlation Between Aam/himco Short and Ab Impact
Can any of the company-specific risk be diversified away by investing in both Aam/himco Short and Ab Impact 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 Aam/himco Short and Ab Impact into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Aamhimco Short Duration and Ab Impact Municipal, you can compare the effects of market volatilities on Aam/himco Short and Ab Impact 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 Aam/himco Short with a short position of Ab Impact. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aam/himco Short and Ab Impact.
Diversification Opportunities for Aam/himco Short and Ab Impact
0.2 | Correlation Coefficient |
Modest diversification
The 3 months correlation between AAM/HIMCO and ABIMX is 0.2. Overlapping area represents the amount of risk that can be diversified away by holding Aamhimco Short Duration and Ab Impact Municipal in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ab Impact Municipal and Aam/himco Short 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 Aamhimco Short Duration are associated (or correlated) with Ab Impact. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ab Impact Municipal has no effect on the direction of Aam/himco Short i.e., Aam/himco Short and Ab Impact go up and down completely randomly.
Pair Corralation between Aam/himco Short and Ab Impact
Assuming the 90 days horizon Aam/himco Short is expected to generate 1.04 times less return on investment than Ab Impact. But when comparing it to its historical volatility, Aamhimco Short Duration is 2.86 times less risky than Ab Impact. It trades about 0.22 of its potential returns per unit of risk. Ab Impact Municipal is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 969.00 in Ab Impact Municipal on October 25, 2024 and sell it today you would earn a total of 4.00 from holding Ab Impact Municipal or generate 0.41% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Aamhimco Short Duration vs. Ab Impact Municipal
Performance |
| Timeline |
| Aamhimco Short Duration |
| Ab Impact Municipal |
Aam/himco Short and Ab Impact Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aam/himco Short and Ab Impact
The main advantage of trading using opposite Aam/himco Short and Ab Impact positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aam/himco Short position performs unexpectedly, Ab Impact 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 Ab Impact will offset losses from the drop in Ab Impact's long position.| Aam/himco Short vs. Mndvux | Aam/himco Short vs. Prudential Jennison International | Aam/himco Short vs. Fidelity New Markets | Aam/himco Short vs. Ohio Variable College |
| Ab Impact vs. Tiaa Cref Real Estate | Ab Impact vs. Simt Real Estate | Ab Impact vs. Commonwealth Real Estate | Ab Impact vs. Nexpoint Real Estate |
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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
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