Correlation Between Aberdeen Select and Aberdeen
Can any of the company-specific risk be diversified away by investing in both Aberdeen Select and Aberdeen 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 Aberdeen Select and Aberdeen into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Aberdeen Select International and Aberdeen Eq Long Short, you can compare the effects of market volatilities on Aberdeen Select and Aberdeen 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 Aberdeen Select with a short position of Aberdeen. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aberdeen Select and Aberdeen.
Diversification Opportunities for Aberdeen Select and Aberdeen
0.75 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Aberdeen and Aberdeen is 0.75. Overlapping area represents the amount of risk that can be diversified away by holding Aberdeen Select International and Aberdeen Eq Long Short in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aberdeen Eq Long and Aberdeen 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 Aberdeen Select International are associated (or correlated) with Aberdeen. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aberdeen Eq Long has no effect on the direction of Aberdeen Select i.e., Aberdeen Select and Aberdeen go up and down completely randomly.
Pair Corralation between Aberdeen Select and Aberdeen
Assuming the 90 days horizon Aberdeen Select International is expected to generate 0.78 times more return on investment than Aberdeen. However, Aberdeen Select International is 1.29 times less risky than Aberdeen. It trades about 0.06 of its potential returns per unit of risk. Aberdeen Eq Long Short is currently generating about 0.04 per unit of risk. If you would invest 2,332 in Aberdeen Select International on August 26, 2024 and sell it today you would earn a total of 676.00 from holding Aberdeen Select International or generate 28.99% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Aberdeen Select International vs. Aberdeen Eq Long Short
Performance |
| Timeline |
| Aberdeen Select Inte |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
OK
| Aberdeen Eq Long |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Modest
Aberdeen Select and Aberdeen Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aberdeen Select and Aberdeen
The main advantage of trading using opposite Aberdeen Select and Aberdeen positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aberdeen Select position performs unexpectedly, Aberdeen 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 Aberdeen will offset losses from the drop in Aberdeen's long position.| Aberdeen Select vs. William Blair International | Aberdeen Select vs. Artisan International Fund | Aberdeen Select vs. Royce Premier Fund | Aberdeen Select vs. The Jensen Portfolio |
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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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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