Correlation Between Commonwealth Real and American Beacon
Can any of the company-specific risk be diversified away by investing in both Commonwealth Real and American Beacon 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 Commonwealth Real and American Beacon into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Commonwealth Real Estate and American Beacon The, you can compare the effects of market volatilities on Commonwealth Real and American Beacon 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 Commonwealth Real with a short position of American Beacon. Check out your portfolio center. Please also check ongoing floating volatility patterns of Commonwealth Real and American Beacon.
Diversification Opportunities for Commonwealth Real and American Beacon
0.39 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Commonwealth and American is 0.39. Overlapping area represents the amount of risk that can be diversified away by holding Commonwealth Real Estate and American Beacon The in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on American Beacon and Commonwealth Real 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 Commonwealth Real Estate are associated (or correlated) with American Beacon. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of American Beacon has no effect on the direction of Commonwealth Real i.e., Commonwealth Real and American Beacon go up and down completely randomly.
Pair Corralation between Commonwealth Real and American Beacon
Assuming the 90 days horizon Commonwealth Real Estate is expected to generate 1.6 times more return on investment than American Beacon. However, Commonwealth Real is 1.6 times more volatile than American Beacon The. It trades about 0.22 of its potential returns per unit of risk. American Beacon The is currently generating about 0.32 per unit of risk. If you would invest 2,471 in Commonwealth Real Estate on September 1, 2024 and sell it today you would earn a total of 108.00 from holding Commonwealth Real Estate or generate 4.37% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
Commonwealth Real Estate vs. American Beacon The
Performance |
| Timeline |
| Commonwealth Real Estate |
| American Beacon |
Commonwealth Real and American Beacon Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Commonwealth Real and American Beacon
The main advantage of trading using opposite Commonwealth Real and American Beacon positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Commonwealth Real position performs unexpectedly, American Beacon 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 Beacon will offset losses from the drop in American Beacon's long position.| Commonwealth Real vs. Commonwealth Global Fund | Commonwealth Real vs. Commonwealth Australianew Zealand | Commonwealth Real vs. Amg Managers Centersquare | Commonwealth Real vs. Commonwealth Japan Fund |
| American Beacon vs. Deutsche Real Estate | American Beacon vs. Goldman Sachs Real | American Beacon vs. Dunham Real Estate | American Beacon vs. Commonwealth Real Estate |
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 Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
Other Complementary Tools
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
| My Watchlist Analysis Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like | |
| Positions Ratings Determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Competition Analyzer Analyze and compare many basic indicators for a group of related or unrelated entities | |
| ETFs Find actively traded Exchange Traded Funds (ETF) from around the world |