Correlation Between Ab Global and Aama Income
Can any of the company-specific risk be diversified away by investing in both Ab Global and Aama Income 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 Aama Income 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 Aama Income Fund, you can compare the effects of market volatilities on Ab Global and Aama Income 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 Aama Income. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ab Global and Aama Income.
Diversification Opportunities for Ab Global and Aama Income
0.03 | Correlation Coefficient |
Significant diversification
The 3 months correlation between CBSYX and Aama is 0.03. Overlapping area represents the amount of risk that can be diversified away by holding Ab Global Risk and Aama Income Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aama Income Fund 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 Aama Income. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aama Income Fund has no effect on the direction of Ab Global i.e., Ab Global and Aama Income go up and down completely randomly.
Pair Corralation between Ab Global and Aama Income
Assuming the 90 days horizon Ab Global is expected to generate 7.37 times less return on investment than Aama Income. In addition to that, Ab Global is 5.92 times more volatile than Aama Income Fund. It trades about 0.0 of its total potential returns per unit of risk. Aama Income Fund is currently generating about 0.1 per unit of volatility. If you would invest 2,233 in Aama Income Fund on September 14, 2024 and sell it today you would earn a total of 159.00 from holding Aama Income Fund or generate 7.12% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ab Global Risk vs. Aama Income Fund
Performance |
| Timeline |
| Ab Global Risk |
| Aama Income Fund |
Ab Global and Aama Income Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ab Global and Aama Income
The main advantage of trading using opposite Ab Global and Aama Income positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ab Global position performs unexpectedly, Aama Income 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 Aama Income will offset losses from the drop in Aama Income's long position.| Ab Global vs. T Rowe Price | Ab Global vs. Guggenheim High Yield | Ab Global vs. Fidelity Capital Income | Ab Global vs. Jpmorgan High Yield |
| Aama Income vs. Commonwealth Global Fund | Aama Income vs. Ab Global Risk | Aama Income vs. 361 Global Longshort | Aama Income vs. Siit Global Managed |
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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
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