Correlation Between Ab Select and Strategic Asset
Can any of the company-specific risk be diversified away by investing in both Ab Select and Strategic Asset 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 Strategic Asset 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 Strategic Asset Management, you can compare the effects of market volatilities on Ab Select and Strategic Asset 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 Strategic Asset. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ab Select and Strategic Asset.
Diversification Opportunities for Ab Select and Strategic Asset
0.98 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between AUUIX and STRATEGIC is 0.98. Overlapping area represents the amount of risk that can be diversified away by holding Ab Select Equity and Strategic Asset Management in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Strategic Asset Mana 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 Strategic Asset. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Strategic Asset Mana has no effect on the direction of Ab Select i.e., Ab Select and Strategic Asset go up and down completely randomly.
Pair Corralation between Ab Select and Strategic Asset
Assuming the 90 days horizon Ab Select Equity is expected to generate 1.14 times more return on investment than Strategic Asset. However, Ab Select is 1.14 times more volatile than Strategic Asset Management. It trades about 0.15 of its potential returns per unit of risk. Strategic Asset Management is currently generating about 0.11 per unit of risk. If you would invest 2,293 in Ab Select Equity on August 30, 2024 and sell it today you would earn a total of 105.00 from holding Ab Select Equity or generate 4.58% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ab Select Equity vs. Strategic Asset Management
Performance |
| Timeline |
| Ab Select Equity |
| Strategic Asset Mana |
Ab Select and Strategic Asset Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ab Select and Strategic Asset
The main advantage of trading using opposite Ab Select and Strategic Asset positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ab Select position performs unexpectedly, Strategic Asset 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 Strategic Asset will offset losses from the drop in Strategic Asset's long position.| Ab Select vs. Eventide Healthcare Life | Ab Select vs. Allianzgi Health Sciences | Ab Select vs. Prudential Health Sciences | Ab Select vs. Alger Health Sciences |
| Strategic Asset vs. Ab Small Cap | Strategic Asset vs. Artisan Small Cap | Strategic Asset vs. Small Midcap Dividend Income | Strategic Asset vs. The Hartford Small |
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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
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