Correlation Between Boston Partners and Aberdeen Gbl
Can any of the company-specific risk be diversified away by investing in both Boston Partners and Aberdeen Gbl 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 Boston Partners and Aberdeen Gbl into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Boston Partners Small and Aberdeen Gbl Eq, you can compare the effects of market volatilities on Boston Partners and Aberdeen Gbl 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 Boston Partners with a short position of Aberdeen Gbl. Check out your portfolio center. Please also check ongoing floating volatility patterns of Boston Partners and Aberdeen Gbl.
Diversification Opportunities for Boston Partners and Aberdeen Gbl
-0.46 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Boston and Aberdeen is -0.46. Overlapping area represents the amount of risk that can be diversified away by holding Boston Partners Small and Aberdeen Gbl Eq in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aberdeen Gbl Eq and Boston Partners 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 Boston Partners Small are associated (or correlated) with Aberdeen Gbl. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aberdeen Gbl Eq has no effect on the direction of Boston Partners i.e., Boston Partners and Aberdeen Gbl go up and down completely randomly.
Pair Corralation between Boston Partners and Aberdeen Gbl
Assuming the 90 days horizon Boston Partners Small is expected to generate 1.52 times more return on investment than Aberdeen Gbl. However, Boston Partners is 1.52 times more volatile than Aberdeen Gbl Eq. It trades about 0.05 of its potential returns per unit of risk. Aberdeen Gbl Eq is currently generating about 0.05 per unit of risk. If you would invest 2,587 in Boston Partners Small on September 4, 2024 and sell it today you would earn a total of 361.00 from holding Boston Partners Small or generate 13.95% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Boston Partners Small vs. Aberdeen Gbl Eq
Performance |
| Timeline |
| Boston Partners Small |
| Aberdeen Gbl Eq |
Boston Partners and Aberdeen Gbl Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Boston Partners and Aberdeen Gbl
The main advantage of trading using opposite Boston Partners and Aberdeen Gbl positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Boston Partners position performs unexpectedly, Aberdeen Gbl 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 Gbl will offset losses from the drop in Aberdeen Gbl's long position.| Boston Partners vs. Aggressive Investors 1 | Boston Partners vs. Buffalo Small Cap | Boston Partners vs. Rice Hall James | Boston Partners vs. Putnam Small Cap |
| Aberdeen Gbl vs. Boston Partners Small | Aberdeen Gbl vs. Fpa Queens Road | Aberdeen Gbl vs. Ab Discovery Value | Aberdeen Gbl vs. Hennessy Nerstone Mid |
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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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