Correlation Between Ab Global and Cambiar Opportunity
Can any of the company-specific risk be diversified away by investing in both Ab Global and Cambiar Opportunity 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 Ab Global and Cambiar Opportunity into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ab Global Risk and Cambiar Opportunity Fund, you can compare the effects of market volatilities on Ab Global and Cambiar Opportunity 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 Ab Global with a short position of Cambiar Opportunity. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ab Global and Cambiar Opportunity.
Diversification Opportunities for Ab Global and Cambiar Opportunity
0.21 | Correlation Coefficient |
Modest diversification
The 3 months correlation between CABIX and Cambiar is 0.21. Overlapping area represents the amount of risk that can be diversified away by holding Ab Global Risk and Cambiar Opportunity Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cambiar Opportunity and Ab Global 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 Ab Global Risk are associated (or correlated) with Cambiar Opportunity. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cambiar Opportunity has no effect on the direction of Ab Global i.e., Ab Global and Cambiar Opportunity go up and down completely randomly.
Pair Corralation between Ab Global and Cambiar Opportunity
Assuming the 90 days horizon Ab Global is expected to generate 1.37 times less return on investment than Cambiar Opportunity. But when comparing it to its historical volatility, Ab Global Risk is 2.07 times less risky than Cambiar Opportunity. It trades about 0.37 of its potential returns per unit of risk. Cambiar Opportunity Fund is currently generating about 0.25 of returns per unit of risk over similar time horizon. If you would invest 2,978 in Cambiar Opportunity Fund on September 2, 2024 and sell it today you would earn a total of 116.00 from holding Cambiar Opportunity Fund or generate 3.9% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ab Global Risk vs. Cambiar Opportunity Fund
Performance |
| Timeline |
| Ab Global Risk |
| Cambiar Opportunity |
Ab Global and Cambiar Opportunity Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ab Global and Cambiar Opportunity
The main advantage of trading using opposite Ab Global and Cambiar Opportunity positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ab Global position performs unexpectedly, Cambiar Opportunity 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 Cambiar Opportunity will offset losses from the drop in Cambiar Opportunity's long position.| Ab Global vs. Allianzgi Convertible Income | Ab Global vs. The Gamco Global | Ab Global vs. Harbor Vertible Securities | Ab Global vs. Advent Claymore Convertible |
| Cambiar Opportunity vs. Boston Partners Small | Cambiar Opportunity vs. Hennessy Nerstone Mid | Cambiar Opportunity vs. Queens Road Small | Cambiar Opportunity vs. Royce Opportunity Fund |
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 Portfolio Anywhere module to track or share privately all of your investments from the convenience of any device.
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