Correlation Between Fidus Investment and Abrdn Emerging
Can any of the company-specific risk be diversified away by investing in both Fidus Investment and Abrdn Emerging 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 Fidus Investment and Abrdn Emerging into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Fidus Investment Corp and Abrdn Emerging Markets, you can compare the effects of market volatilities on Fidus Investment and Abrdn Emerging 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 Fidus Investment with a short position of Abrdn Emerging. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fidus Investment and Abrdn Emerging.
Diversification Opportunities for Fidus Investment and Abrdn Emerging
-0.43 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Fidus and Abrdn is -0.43. Overlapping area represents the amount of risk that can be diversified away by holding Fidus Investment Corp and Abrdn Emerging Markets in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Abrdn Emerging Markets and Fidus Investment 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 Fidus Investment Corp are associated (or correlated) with Abrdn Emerging. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Abrdn Emerging Markets has no effect on the direction of Fidus Investment i.e., Fidus Investment and Abrdn Emerging go up and down completely randomly.
Pair Corralation between Fidus Investment and Abrdn Emerging
Given the investment horizon of 90 days Fidus Investment Corp is expected to generate 0.68 times more return on investment than Abrdn Emerging. However, Fidus Investment Corp is 1.47 times less risky than Abrdn Emerging. It trades about 0.45 of its potential returns per unit of risk. Abrdn Emerging Markets is currently generating about -0.12 per unit of risk. If you would invest 1,948 in Fidus Investment Corp on August 31, 2024 and sell it today you would earn a total of 160.00 from holding Fidus Investment Corp or generate 8.21% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Fidus Investment Corp vs. Abrdn Emerging Markets
Performance |
| Timeline |
| Fidus Investment Corp |
| Abrdn Emerging Markets |
Fidus Investment and Abrdn Emerging Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fidus Investment and Abrdn Emerging
The main advantage of trading using opposite Fidus Investment and Abrdn Emerging positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fidus Investment position performs unexpectedly, Abrdn Emerging 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 Emerging will offset losses from the drop in Abrdn Emerging's long position.| Fidus Investment vs. Ares Capital | Fidus Investment vs. Hercules Capital | Fidus Investment vs. Main Street Capital |
| Abrdn Emerging vs. DWS Municipal Income | Abrdn Emerging vs. Blackrock Muni Intermediate | Abrdn Emerging vs. Blackrock Muniyield | Abrdn Emerging vs. Flow Capital Corp |
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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