Correlation Between Ab Select and Nationwide International
Can any of the company-specific risk be diversified away by investing in both Ab Select and Nationwide International 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 Nationwide International 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 Nationwide International Index, you can compare the effects of market volatilities on Ab Select and Nationwide International 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 Nationwide International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ab Select and Nationwide International.
Diversification Opportunities for Ab Select and Nationwide International
-0.58 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between AUUIX and Nationwide is -0.58. Overlapping area represents the amount of risk that can be diversified away by holding Ab Select Equity and Nationwide International Index in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nationwide International 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 Nationwide International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nationwide International has no effect on the direction of Ab Select i.e., Ab Select and Nationwide International go up and down completely randomly.
Pair Corralation between Ab Select and Nationwide International
Assuming the 90 days horizon Ab Select Equity is expected to generate 0.87 times more return on investment than Nationwide International. However, Ab Select Equity is 1.15 times less risky than Nationwide International. It trades about 0.35 of its potential returns per unit of risk. Nationwide International Index is currently generating about -0.01 per unit of risk. If you would invest 2,283 in Ab Select Equity on September 1, 2024 and sell it today you would earn a total of 127.00 from holding Ab Select Equity or generate 5.56% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
Ab Select Equity vs. Nationwide International Index
Performance |
| Timeline |
| Ab Select Equity |
| Nationwide International |
Ab Select and Nationwide International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ab Select and Nationwide International
The main advantage of trading using opposite Ab Select and Nationwide International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ab Select position performs unexpectedly, Nationwide International 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 Nationwide International will offset losses from the drop in Nationwide International'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 |
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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
Other Complementary Tools
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine | |
| Idea Breakdown Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes | |
| Portfolio Comparator Compare the composition, asset allocations and performance of any two portfolios in your account | |
| Global Correlations Find global opportunities by holding instruments from different markets | |
| Pair Correlation Compare performance and examine fundamental relationship between any two equity instruments |