Correlation Between Ab Select and Equity Growth
Can any of the company-specific risk be diversified away by investing in both Ab Select and Equity Growth 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 Equity Growth into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ab Select Equity and Equity Growth Fund, you can compare the effects of market volatilities on Ab Select and Equity Growth 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 Equity Growth. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ab Select and Equity Growth.
Diversification Opportunities for Ab Select and Equity Growth
0.57 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between AUUIX and Equity is 0.57. Overlapping area represents the amount of risk that can be diversified away by holding Ab Select Equity and Equity Growth Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Equity Growth 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 Equity are associated (or correlated) with Equity Growth. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Equity Growth has no effect on the direction of Ab Select i.e., Ab Select and Equity Growth go up and down completely randomly.
Pair Corralation between Ab Select and Equity Growth
Assuming the 90 days horizon Ab Select Equity is expected to under-perform the Equity Growth. In addition to that, Ab Select is 1.91 times more volatile than Equity Growth Fund. It trades about -0.2 of its total potential returns per unit of risk. Equity Growth Fund is currently generating about -0.03 per unit of volatility. If you would invest 3,382 in Equity Growth Fund on September 20, 2024 and sell it today you would lose (23.00) from holding Equity Growth Fund or give up 0.68% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ab Select Equity vs. Equity Growth Fund
Performance |
| Timeline |
| Ab Select Equity |
| Equity Growth |
Ab Select and Equity Growth Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ab Select and Equity Growth
The main advantage of trading using opposite Ab Select and Equity Growth positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ab Select position performs unexpectedly, Equity Growth 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 Equity Growth will offset losses from the drop in Equity Growth's long position.| Ab Select vs. Ashmore Emerging Markets | Ab Select vs. Pnc Emerging Markets | Ab Select vs. Extended Market Index | Ab Select vs. Origin Emerging Markets |
| Equity Growth vs. Us Vector Equity | Equity Growth vs. Multimedia Portfolio Multimedia | Equity Growth vs. Ab Select Equity | Equity Growth vs. Calamos Global Equity |
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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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