Correlation Between Ab Select and Nationwide Core
Can any of the company-specific risk be diversified away by investing in both Ab Select and Nationwide Core 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 Core 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 E Plus, you can compare the effects of market volatilities on Ab Select and Nationwide Core 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 Core. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ab Select and Nationwide Core.
Diversification Opportunities for Ab Select and Nationwide Core
-0.76 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between AUUIX and Nationwide is -0.76. Overlapping area represents the amount of risk that can be diversified away by holding Ab Select Equity and Nationwide E Plus in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nationwide E Plus 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 Core. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nationwide E Plus has no effect on the direction of Ab Select i.e., Ab Select and Nationwide Core go up and down completely randomly.
Pair Corralation between Ab Select and Nationwide Core
Assuming the 90 days horizon Ab Select Equity is expected to generate 2.72 times more return on investment than Nationwide Core. However, Ab Select is 2.72 times more volatile than Nationwide E Plus. It trades about 0.17 of its potential returns per unit of risk. Nationwide E Plus is currently generating about -0.1 per unit of risk. If you would invest 2,310 in Ab Select Equity on August 26, 2024 and sell it today you would earn a total of 71.00 from holding Ab Select Equity or generate 3.07% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ab Select Equity vs. Nationwide E Plus
Performance |
| Timeline |
| Ab Select Equity |
| Nationwide E Plus |
Ab Select and Nationwide Core Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ab Select and Nationwide Core
The main advantage of trading using opposite Ab Select and Nationwide Core positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ab Select position performs unexpectedly, Nationwide Core 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 Core will offset losses from the drop in Nationwide Core's long position.| Ab Select vs. Shelton Emerging Markets | Ab Select vs. Ep Emerging Markets | Ab Select vs. Extended Market Index | Ab Select vs. Transamerica Emerging Markets |
| Nationwide Core vs. Federated Equity Income | Nationwide Core vs. Small Cap Equity | Nationwide Core vs. Ab Select Equity | Nationwide Core vs. Gmo 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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
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