Correlation Between Ambassador Fund and Aberdeen Income
Can any of the company-specific risk be diversified away by investing in both Ambassador Fund and Aberdeen 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 Ambassador Fund and Aberdeen Income into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ambassador Fund and Aberdeen Income Credit, you can compare the effects of market volatilities on Ambassador Fund and Aberdeen 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 Ambassador Fund with a short position of Aberdeen Income. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ambassador Fund and Aberdeen Income.
Diversification Opportunities for Ambassador Fund and Aberdeen Income
-0.71 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Ambassador and Aberdeen is -0.71. Overlapping area represents the amount of risk that can be diversified away by holding Ambassador Fund and Aberdeen Income Credit in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aberdeen Income Credit and Ambassador Fund 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 Ambassador Fund are associated (or correlated) with Aberdeen Income. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aberdeen Income Credit has no effect on the direction of Ambassador Fund i.e., Ambassador Fund and Aberdeen Income go up and down completely randomly.
Pair Corralation between Ambassador Fund and Aberdeen Income
Assuming the 90 days horizon Ambassador Fund is expected to generate 9.72 times less return on investment than Aberdeen Income. But when comparing it to its historical volatility, Ambassador Fund is 8.57 times less risky than Aberdeen Income. It trades about 0.38 of its potential returns per unit of risk. Aberdeen Income Credit is currently generating about 0.43 of returns per unit of risk over similar time horizon. If you would invest 575.00 in Aberdeen Income Credit on October 20, 2024 and sell it today you would earn a total of 34.00 from holding Aberdeen Income Credit or generate 5.91% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ambassador Fund vs. Aberdeen Income Credit
Performance |
| Timeline |
| Ambassador Fund |
| Aberdeen Income Credit |
Ambassador Fund and Aberdeen Income Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ambassador Fund and Aberdeen Income
The main advantage of trading using opposite Ambassador Fund and Aberdeen Income positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ambassador Fund position performs unexpectedly, Aberdeen 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 Aberdeen Income will offset losses from the drop in Aberdeen Income's long position.| Ambassador Fund vs. Goldman Sachs Short | Ambassador Fund vs. Short Precious Metals | Ambassador Fund vs. The Gold Bullion | Ambassador Fund vs. Fidelity Advisor Gold |
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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
Other Complementary Tools
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation | |
| Portfolio Anywhere Track or share privately all of your investments from the convenience of any device | |
| Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas | |
| Watchlist Optimization Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm | |
| Correlation Analysis Reduce portfolio risk simply by holding instruments which are not perfectly correlated |