Correlation Between Ab Municipal and Multi Index
Can any of the company-specific risk be diversified away by investing in both Ab Municipal and Multi Index 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 Municipal and Multi Index into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ab Municipal Bond and Multi Index 2030 Lifetime, you can compare the effects of market volatilities on Ab Municipal and Multi Index 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 Municipal with a short position of Multi Index. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ab Municipal and Multi Index.
Diversification Opportunities for Ab Municipal and Multi Index
0.79 | Correlation Coefficient |
Poor diversification
The 3 months correlation between AUNTX and Multi is 0.79. Overlapping area represents the amount of risk that can be diversified away by holding Ab Municipal Bond and Multi Index 2030 Lifetime in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Multi Index 2030 and Ab Municipal 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 Municipal Bond are associated (or correlated) with Multi Index. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Multi Index 2030 has no effect on the direction of Ab Municipal i.e., Ab Municipal and Multi Index go up and down completely randomly.
Pair Corralation between Ab Municipal and Multi Index
Assuming the 90 days horizon Ab Municipal Bond is expected to generate 0.37 times more return on investment than Multi Index. However, Ab Municipal Bond is 2.7 times less risky than Multi Index. It trades about 0.11 of its potential returns per unit of risk. Multi Index 2030 Lifetime is currently generating about 0.0 per unit of risk. If you would invest 1,064 in Ab Municipal Bond on November 7, 2024 and sell it today you would earn a total of 13.00 from holding Ab Municipal Bond or generate 1.22% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ab Municipal Bond vs. Multi Index 2030 Lifetime
Performance |
| Timeline |
| Ab Municipal Bond |
| Multi Index 2030 |
Ab Municipal and Multi Index Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ab Municipal and Multi Index
The main advantage of trading using opposite Ab Municipal and Multi Index positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ab Municipal position performs unexpectedly, Multi Index 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 Multi Index will offset losses from the drop in Multi Index's long position.| Ab Municipal vs. Kinetics Small Cap | Ab Municipal vs. Rbc International Small | Ab Municipal vs. Ab Small Cap | Ab Municipal vs. Needham Small Cap |
| Multi Index vs. Massmutual Premier Diversified | Multi Index vs. Harbor Diversified International | Multi Index vs. Global Diversified Income | Multi Index vs. Diversified Income 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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
Other Complementary Tools
| Technical Analysis Check basic technical indicators and analysis based on most latest market data | |
| Portfolio Manager State of the art Portfolio Manager to monitor and improve performance of your invested capital | |
| Money Managers Screen money managers from public funds and ETFs managed around the world | |
| USA ETFs Find actively traded Exchange Traded Funds (ETF) in USA | |
| Aroon Oscillator Analyze current equity momentum using Aroon Oscillator and other momentum ratios |