Correlation Between BNY Mellon and AB Active
Can any of the company-specific risk be diversified away by investing in both BNY Mellon and AB Active 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 BNY Mellon and AB Active into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between BNY Mellon High and AB Active ETFs,, you can compare the effects of market volatilities on BNY Mellon and AB Active 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 BNY Mellon with a short position of AB Active. Check out your portfolio center. Please also check ongoing floating volatility patterns of BNY Mellon and AB Active.
Diversification Opportunities for BNY Mellon and AB Active
-0.35 | Correlation Coefficient |
Very good diversification
The 3 months correlation between BNY and ILOW is -0.35. Overlapping area represents the amount of risk that can be diversified away by holding BNY Mellon High and AB Active ETFs, in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AB Active ETFs, and BNY Mellon 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 BNY Mellon High are associated (or correlated) with AB Active. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AB Active ETFs, has no effect on the direction of BNY Mellon i.e., BNY Mellon and AB Active go up and down completely randomly.
Pair Corralation between BNY Mellon and AB Active
Considering the 90-day investment horizon BNY Mellon High is expected to generate 1.04 times more return on investment than AB Active. However, BNY Mellon is 1.04 times more volatile than AB Active ETFs,. It trades about 0.12 of its potential returns per unit of risk. AB Active ETFs, is currently generating about 0.02 per unit of risk. If you would invest 234.00 in BNY Mellon High on September 1, 2024 and sell it today you would earn a total of 31.00 from holding BNY Mellon High or generate 13.25% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 79.37% |
| Values | Daily Returns |
BNY Mellon High vs. AB Active ETFs,
Performance |
| Timeline |
| BNY Mellon High |
| AB Active ETFs, |
BNY Mellon and AB Active Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BNY Mellon and AB Active
The main advantage of trading using opposite BNY Mellon and AB Active positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BNY Mellon position performs unexpectedly, AB Active 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 Active will offset losses from the drop in AB Active's long position.| BNY Mellon vs. Credit Suisse Asset | BNY Mellon vs. Mfs Intermediate High | BNY Mellon vs. Eaton Vance Risk | BNY Mellon vs. Nuveen Floating Rate |
| AB Active vs. iShares ESG Aggregate | AB Active vs. SPDR MSCI Emerging | AB Active vs. Aquagold International | AB Active vs. Thrivent High Yield |
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 Center module to all portfolio management and optimization tools to improve performance of your portfolios.
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