Correlation Between Ashmore Emerging and Abrdn Global
Can any of the company-specific risk be diversified away by investing in both Ashmore Emerging and Abrdn Global 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 Ashmore Emerging and Abrdn Global into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ashmore Emerging Markets and Abrdn Global Infrastructure, you can compare the effects of market volatilities on Ashmore Emerging and Abrdn Global 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 Ashmore Emerging with a short position of Abrdn Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ashmore Emerging and Abrdn Global.
Diversification Opportunities for Ashmore Emerging and Abrdn Global
-0.79 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Ashmore and Abrdn is -0.79. Overlapping area represents the amount of risk that can be diversified away by holding Ashmore Emerging Markets and Abrdn Global Infrastructure in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Abrdn Global Infrast and Ashmore 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 Ashmore Emerging Markets are associated (or correlated) with Abrdn Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Abrdn Global Infrast has no effect on the direction of Ashmore Emerging i.e., Ashmore Emerging and Abrdn Global go up and down completely randomly.
Pair Corralation between Ashmore Emerging and Abrdn Global
Assuming the 90 days horizon Ashmore Emerging is expected to generate 9.83 times less return on investment than Abrdn Global. But when comparing it to its historical volatility, Ashmore Emerging Markets is 8.93 times less risky than Abrdn Global. It trades about 0.08 of its potential returns per unit of risk. Abrdn Global Infrastructure is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 1,926 in Abrdn Global Infrastructure on October 21, 2024 and sell it today you would earn a total of 21.00 from holding Abrdn Global Infrastructure or generate 1.09% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ashmore Emerging Markets vs. Abrdn Global Infrastructure
Performance |
| Timeline |
| Ashmore Emerging Markets |
| Abrdn Global Infrast |
Ashmore Emerging and Abrdn Global Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ashmore Emerging and Abrdn Global
The main advantage of trading using opposite Ashmore Emerging and Abrdn Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ashmore Emerging position performs unexpectedly, Abrdn Global 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 Abrdn Global will offset losses from the drop in Abrdn Global's long position.| Ashmore Emerging vs. Putnam Diversified Income | Ashmore Emerging vs. Tiaa Cref Lifestyle Conservative | Ashmore Emerging vs. Stone Ridge Diversified | Ashmore Emerging vs. Federated Hermes Conservative |
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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 Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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