Correlation Between Alliancebernstein and Kensington Dynamic
Can any of the company-specific risk be diversified away by investing in both Alliancebernstein and Kensington Dynamic 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 Alliancebernstein and Kensington Dynamic into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Alliancebernstein Global High and Kensington Dynamic Growth, you can compare the effects of market volatilities on Alliancebernstein and Kensington Dynamic 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 Alliancebernstein with a short position of Kensington Dynamic. Check out your portfolio center. Please also check ongoing floating volatility patterns of Alliancebernstein and Kensington Dynamic.
Diversification Opportunities for Alliancebernstein and Kensington Dynamic
-0.25 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Alliancebernstein and Kensington is -0.25. Overlapping area represents the amount of risk that can be diversified away by holding Alliancebernstein Global High and Kensington Dynamic Growth in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kensington Dynamic Growth and Alliancebernstein 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 Alliancebernstein Global High are associated (or correlated) with Kensington Dynamic. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kensington Dynamic Growth has no effect on the direction of Alliancebernstein i.e., Alliancebernstein and Kensington Dynamic go up and down completely randomly.
Pair Corralation between Alliancebernstein and Kensington Dynamic
Considering the 90-day investment horizon Alliancebernstein Global High is expected to generate 0.93 times more return on investment than Kensington Dynamic. However, Alliancebernstein Global High is 1.08 times less risky than Kensington Dynamic. It trades about 0.09 of its potential returns per unit of risk. Kensington Dynamic Growth is currently generating about 0.04 per unit of risk. If you would invest 800.00 in Alliancebernstein Global High on September 14, 2024 and sell it today you would earn a total of 283.00 from holding Alliancebernstein Global High or generate 35.38% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Alliancebernstein Global High vs. Kensington Dynamic Growth
Performance |
| Timeline |
| Alliancebernstein |
| Kensington Dynamic Growth |
Alliancebernstein and Kensington Dynamic Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Alliancebernstein and Kensington Dynamic
The main advantage of trading using opposite Alliancebernstein and Kensington Dynamic positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Alliancebernstein position performs unexpectedly, Kensington Dynamic 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 Kensington Dynamic will offset losses from the drop in Kensington Dynamic's long position.| Alliancebernstein vs. Western Asset High | Alliancebernstein vs. Blackrock Debt Strategies | Alliancebernstein vs. Western Asset Diversified | Alliancebernstein vs. Western Asset Global |
| Kensington Dynamic vs. Jhancock Global Equity | Kensington Dynamic vs. Ab Global Risk | Kensington Dynamic vs. 361 Global Longshort | Kensington Dynamic vs. Legg Mason Global |
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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
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