Correlation Between Federated Global and Ab Global
Can any of the company-specific risk be diversified away by investing in both Federated Global and Ab 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 Federated Global and Ab Global into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Federated Global Allocation and Ab Global Risk, you can compare the effects of market volatilities on Federated Global and Ab 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 Federated Global with a short position of Ab Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of Federated Global and Ab Global.
Diversification Opportunities for Federated Global and Ab Global
0.74 | Correlation Coefficient |
Poor diversification
The 3 months correlation between FEDERATED and CABIX is 0.74. Overlapping area represents the amount of risk that can be diversified away by holding Federated Global Allocation and Ab Global Risk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ab Global Risk and Federated Global 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 Federated Global Allocation are associated (or correlated) with Ab Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ab Global Risk has no effect on the direction of Federated Global i.e., Federated Global and Ab Global go up and down completely randomly.
Pair Corralation between Federated Global and Ab Global
Assuming the 90 days horizon Federated Global Allocation is expected to generate 1.14 times more return on investment than Ab Global. However, Federated Global is 1.14 times more volatile than Ab Global Risk. It trades about 0.12 of its potential returns per unit of risk. Ab Global Risk is currently generating about 0.12 per unit of risk. If you would invest 1,943 in Federated Global Allocation on September 2, 2024 and sell it today you would earn a total of 67.00 from holding Federated Global Allocation or generate 3.45% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Federated Global Allocation vs. Ab Global Risk
Performance |
| Timeline |
| Federated Global All |
| Ab Global Risk |
Federated Global and Ab Global Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Federated Global and Ab Global
The main advantage of trading using opposite Federated Global and Ab Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Federated Global position performs unexpectedly, Ab 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 Ab Global will offset losses from the drop in Ab Global's long position.| Federated Global vs. Federated Max Cap Index | Federated Global vs. Federated Fund For | Federated Global vs. Aquagold International | Federated Global vs. Thrivent High Yield |
| Ab Global vs. Allianzgi Convertible Income | Ab Global vs. The Gamco Global | Ab Global vs. Harbor Vertible Securities | Ab Global vs. Advent Claymore Convertible |
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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
Other Complementary Tools
| Portfolio Comparator Compare the composition, asset allocations and performance of any two portfolios in your account | |
| Portfolio Rebalancing Analyze risk-adjusted returns against different time horizons to find asset-allocation targets | |
| Bollinger Bands Use Bollinger Bands indicator to analyze target price for a given investing horizon | |
| Global Markets Map Get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes | |
| Crypto Correlations Use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins |