Correlation Between Alliancebernstein and Al Frank
Can any of the company-specific risk be diversified away by investing in both Alliancebernstein and Al Frank 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 Al Frank 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 Al Frank Fund, you can compare the effects of market volatilities on Alliancebernstein and Al Frank 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 Al Frank. Check out your portfolio center. Please also check ongoing floating volatility patterns of Alliancebernstein and Al Frank.
Diversification Opportunities for Alliancebernstein and Al Frank
-0.08 | Correlation Coefficient |
Good diversification
The 3 months correlation between Alliancebernstein and VALAX is -0.08. Overlapping area represents the amount of risk that can be diversified away by holding Alliancebernstein Global High and Al Frank Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Al Frank Fund 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 Al Frank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Al Frank Fund has no effect on the direction of Alliancebernstein i.e., Alliancebernstein and Al Frank go up and down completely randomly.
Pair Corralation between Alliancebernstein and Al Frank
Considering the 90-day investment horizon Alliancebernstein Global High is expected to generate 0.19 times more return on investment than Al Frank. However, Alliancebernstein Global High is 5.19 times less risky than Al Frank. It trades about 0.07 of its potential returns per unit of risk. Al Frank Fund is currently generating about -0.23 per unit of risk. If you would invest 1,077 in Alliancebernstein Global High on September 14, 2024 and sell it today you would earn a total of 6.00 from holding Alliancebernstein Global High or generate 0.56% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.45% |
| Values | Daily Returns |
Alliancebernstein Global High vs. Al Frank Fund
Performance |
| Timeline |
| Alliancebernstein |
| Al Frank Fund |
Alliancebernstein and Al Frank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Alliancebernstein and Al Frank
The main advantage of trading using opposite Alliancebernstein and Al Frank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Alliancebernstein position performs unexpectedly, Al Frank 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 Al Frank will offset losses from the drop in Al Frank's long position.| Alliancebernstein vs. Western Asset High | Alliancebernstein vs. Blackrock Debt Strategies | Alliancebernstein vs. Western Asset Diversified | Alliancebernstein vs. Western Asset Global |
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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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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