Correlation Between Advent Claymore and Ab High
Can any of the company-specific risk be diversified away by investing in both Advent Claymore and Ab High 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 Advent Claymore and Ab High into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Advent Claymore Convertible and Ab High Income, you can compare the effects of market volatilities on Advent Claymore and Ab High 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 Advent Claymore with a short position of Ab High. Check out your portfolio center. Please also check ongoing floating volatility patterns of Advent Claymore and Ab High.
Diversification Opportunities for Advent Claymore and Ab High
0.85 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Advent and AGDAX is 0.85. Overlapping area represents the amount of risk that can be diversified away by holding Advent Claymore Convertible and Ab High Income in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ab High Income and Advent Claymore 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 Advent Claymore Convertible are associated (or correlated) with Ab High. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ab High Income has no effect on the direction of Advent Claymore i.e., Advent Claymore and Ab High go up and down completely randomly.
Pair Corralation between Advent Claymore and Ab High
Considering the 90-day investment horizon Advent Claymore Convertible is expected to generate 3.49 times more return on investment than Ab High. However, Advent Claymore is 3.49 times more volatile than Ab High Income. It trades about 0.08 of its potential returns per unit of risk. Ab High Income is currently generating about 0.15 per unit of risk. If you would invest 832.00 in Advent Claymore Convertible on September 13, 2024 and sell it today you would earn a total of 418.00 from holding Advent Claymore Convertible or generate 50.24% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Advent Claymore Convertible vs. Ab High Income
Performance |
| Timeline |
| Advent Claymore Conv |
| Ab High Income |
Advent Claymore and Ab High Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Advent Claymore and Ab High
The main advantage of trading using opposite Advent Claymore and Ab High positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Advent Claymore position performs unexpectedly, Ab High 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 Ab High will offset losses from the drop in Ab High's long position.| Advent Claymore vs. Nuveen Global High | Advent Claymore vs. Blackstone Gso Strategic | Advent Claymore vs. Thornburg Income Builder | Advent Claymore vs. Western Asset Diversified |
| Ab High vs. Absolute Convertible Arbitrage | Ab High vs. Gabelli Convertible And | Ab High vs. Advent Claymore Convertible | Ab High vs. Allianzgi Convertible 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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
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