Correlation Between Ep Emerging and American Beacon
Can any of the company-specific risk be diversified away by investing in both Ep Emerging 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 Ep Emerging and American Beacon into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ep Emerging Markets and American Beacon The, you can compare the effects of market volatilities on Ep Emerging 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 Ep Emerging with a short position of American Beacon. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ep Emerging and American Beacon.
Diversification Opportunities for Ep Emerging and American Beacon
0.03 | Correlation Coefficient |
Significant diversification
The 3 months correlation between EPEIX and AMERICAN is 0.03. Overlapping area represents the amount of risk that can be diversified away by holding Ep Emerging Markets and American Beacon The in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on American Beacon and Ep Emerging 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 Ep Emerging Markets 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 Ep Emerging i.e., Ep Emerging and American Beacon go up and down completely randomly.
Pair Corralation between Ep Emerging and American Beacon
Assuming the 90 days horizon Ep Emerging Markets is expected to under-perform the American Beacon. In addition to that, Ep Emerging is 1.39 times more volatile than American Beacon The. It trades about -0.22 of its total potential returns per unit of risk. American Beacon The is currently generating about 0.37 per unit of volatility. If you would invest 2,355 in American Beacon The on September 3, 2024 and sell it today you would earn a total of 108.00 from holding American Beacon The or generate 4.59% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ep Emerging Markets vs. American Beacon The
Performance |
| Timeline |
| Ep Emerging Markets |
| American Beacon |
Ep Emerging and American Beacon Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ep Emerging and American Beacon
The main advantage of trading using opposite Ep Emerging and American Beacon positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ep Emerging 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.| Ep Emerging vs. Franklin Mutual Global | Ep Emerging vs. Templeton Growth Fund | Ep Emerging vs. Franklin Real Estate | Ep Emerging vs. HUMANA INC |
| American Beacon vs. Ep Emerging Markets | American Beacon vs. Templeton Emerging Markets | American Beacon vs. Jpmorgan Emerging Markets | American Beacon vs. Nasdaq 100 2x Strategy |
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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
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