Correlation Between Boston Trust and Ab Global
Can any of the company-specific risk be diversified away by investing in both Boston Trust and Ab Global 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 Trust and Ab Global into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Boston Trust Smid and Ab Global Bond, you can compare the effects of market volatilities on Boston Trust and Ab Global 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 Trust with a short position of Ab Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of Boston Trust and Ab Global.
Diversification Opportunities for Boston Trust and Ab Global
-0.52 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Boston and ANAGX is -0.52. Overlapping area represents the amount of risk that can be diversified away by holding Boston Trust Smid and Ab Global Bond in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ab Global Bond and Boston Trust 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 Trust Smid are associated (or correlated) with Ab Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ab Global Bond has no effect on the direction of Boston Trust i.e., Boston Trust and Ab Global go up and down completely randomly.
Pair Corralation between Boston Trust and Ab Global
Assuming the 90 days horizon Boston Trust Smid is expected to generate 3.07 times more return on investment than Ab Global. However, Boston Trust is 3.07 times more volatile than Ab Global Bond. It trades about 0.06 of its potential returns per unit of risk. Ab Global Bond is currently generating about 0.06 per unit of risk. If you would invest 2,095 in Boston Trust Smid on September 3, 2024 and sell it today you would earn a total of 650.00 from holding Boston Trust Smid or generate 31.03% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Boston Trust Smid vs. Ab Global Bond
Performance |
| Timeline |
| Boston Trust Smid |
| Ab Global Bond |
Boston Trust and Ab Global Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Boston Trust and Ab Global
The main advantage of trading using opposite Boston Trust and Ab Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Boston Trust position performs unexpectedly, Ab Global 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 Ab Global will offset losses from the drop in Ab Global's long position.| Boston Trust vs. Ab Global Bond | Boston Trust vs. Barings Global Floating | Boston Trust vs. Dreyfusstandish Global Fixed | Boston Trust vs. Scharf Global Opportunity |
| Ab Global vs. Vanguard Total International | Ab Global vs. Vanguard Total International | Ab Global vs. Vanguard Total International | Ab Global vs. Dfa Five Year 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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
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