Correlation Between Ab Municipal and Bny Mellon
Can any of the company-specific risk be diversified away by investing in both Ab Municipal and Bny Mellon 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 Bny Mellon 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 Bny Mellon New, you can compare the effects of market volatilities on Ab Municipal and Bny Mellon 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 Bny Mellon. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ab Municipal and Bny Mellon.
Diversification Opportunities for Ab Municipal and Bny Mellon
0.32 | Correlation Coefficient |
Weak diversification
The 3 months correlation between AUNTX and Bny is 0.32. Overlapping area represents the amount of risk that can be diversified away by holding Ab Municipal Bond and Bny Mellon New in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bny Mellon New 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 Bny Mellon. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bny Mellon New has no effect on the direction of Ab Municipal i.e., Ab Municipal and Bny Mellon go up and down completely randomly.
Pair Corralation between Ab Municipal and Bny Mellon
Assuming the 90 days horizon Ab Municipal Bond is expected to generate 0.64 times more return on investment than Bny Mellon. However, Ab Municipal Bond is 1.57 times less risky than Bny Mellon. It trades about 0.18 of its potential returns per unit of risk. Bny Mellon New is currently generating about 0.1 per unit of risk. If you would invest 1,067 in Ab Municipal Bond on August 26, 2024 and sell it today you would earn a total of 7.00 from holding Ab Municipal Bond or generate 0.66% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ab Municipal Bond vs. Bny Mellon New
Performance |
| Timeline |
| Ab Municipal Bond |
| Bny Mellon New |
Ab Municipal and Bny Mellon Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ab Municipal and Bny Mellon
The main advantage of trading using opposite Ab Municipal and Bny Mellon positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ab Municipal position performs unexpectedly, Bny Mellon 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 Bny Mellon will offset losses from the drop in Bny Mellon's long position.| Ab Municipal vs. Ab Global E | Ab Municipal vs. Ab Global E | Ab Municipal vs. Ab Minnesota Portfolio | Ab Municipal vs. Ab All Market |
| Bny Mellon vs. Ab Municipal Bond | Bny Mellon vs. Tiaa Cref Inflation Link | Bny Mellon vs. Fidelity Sai Inflationfocused | Bny Mellon vs. Blackrock Inflation Protected |
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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
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