Correlation Between Saba Capital and American Century
Can any of the company-specific risk be diversified away by investing in both Saba Capital and American Century 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 Saba Capital and American Century into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Saba Capital Income and American Century ETF, you can compare the effects of market volatilities on Saba Capital and American Century 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 Saba Capital with a short position of American Century. Check out your portfolio center. Please also check ongoing floating volatility patterns of Saba Capital and American Century.
Diversification Opportunities for Saba Capital and American Century
-0.57 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Saba and American is -0.57. Overlapping area represents the amount of risk that can be diversified away by holding Saba Capital Income and American Century ETF in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on American Century ETF and Saba Capital 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 Saba Capital Income are associated (or correlated) with American Century. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of American Century ETF has no effect on the direction of Saba Capital i.e., Saba Capital and American Century go up and down completely randomly.
Pair Corralation between Saba Capital and American Century
Considering the 90-day investment horizon Saba Capital Income is expected to generate 0.42 times more return on investment than American Century. However, Saba Capital Income is 2.37 times less risky than American Century. It trades about 0.7 of its potential returns per unit of risk. American Century ETF is currently generating about 0.08 per unit of risk. If you would invest 742.00 in Saba Capital Income on September 1, 2024 and sell it today you would earn a total of 42.00 from holding Saba Capital Income or generate 5.66% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Saba Capital Income vs. American Century ETF
Performance |
| Timeline |
| Saba Capital Income |
| American Century ETF |
Saba Capital and American Century Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Saba Capital and American Century
The main advantage of trading using opposite Saba Capital and American Century positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Saba Capital position performs unexpectedly, American Century 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 American Century will offset losses from the drop in American Century's long position.| Saba Capital vs. Federated Premier Municipal | Saba Capital vs. Blackrock Muniyield | Saba Capital vs. Diamond Hill Investment | Saba Capital vs. NXG NextGen Infrastructure |
| American Century vs. Vanguard Global ex US | American Century vs. Vanguard FTSE All World | American Century vs. Vanguard Small Cap Value | American Century vs. Vanguard FTSE Pacific |
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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
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