Correlation Between Ab Select and Federated Equity
Can any of the company-specific risk be diversified away by investing in both Ab Select and Federated Equity 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 Equity 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 Federated Equity Income, you can compare the effects of market volatilities on Ab Select and Federated Equity 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 Equity. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ab Select and Federated Equity.
Diversification Opportunities for Ab Select and Federated Equity
0.93 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between AUUIX and Federated is 0.93. Overlapping area represents the amount of risk that can be diversified away by holding Ab Select Equity and Federated Equity Income in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Federated Equity Income 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 Federated Equity. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Federated Equity Income has no effect on the direction of Ab Select i.e., Ab Select and Federated Equity go up and down completely randomly.
Pair Corralation between Ab Select and Federated Equity
Assuming the 90 days horizon Ab Select Equity is expected to generate 0.97 times more return on investment than Federated Equity. However, Ab Select Equity is 1.03 times less risky than Federated Equity. It trades about 0.13 of its potential returns per unit of risk. Federated Equity Income is currently generating about 0.08 per unit of risk. If you would invest 1,597 in Ab Select Equity on September 1, 2024 and sell it today you would earn a total of 813.00 from holding Ab Select Equity or generate 50.91% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 99.78% |
| Values | Daily Returns |
Ab Select Equity vs. Federated Equity Income
Performance |
| Timeline |
| Ab Select Equity |
| Federated Equity Income |
Ab Select and Federated Equity Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ab Select and Federated Equity
The main advantage of trading using opposite Ab Select and Federated Equity positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ab Select position performs unexpectedly, Federated Equity 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 Equity will offset losses from the drop in Federated Equity's long position.| Ab Select vs. Fidelity Advisor Energy | Ab Select vs. Gamco Natural Resources | Ab Select vs. Hennessy Bp Energy | Ab Select vs. Alpsalerian Energy Infrastructure |
| Federated Equity vs. Delaware Limited Term Diversified | Federated Equity vs. Lord Abbett Diversified | Federated Equity vs. Massmutual Premier Diversified | Federated Equity vs. Pimco Diversified Income |
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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
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