Correlation Between Aberdeen Emerging and Abrdn Em
Can any of the company-specific risk be diversified away by investing in both Aberdeen Emerging and Abrdn Em 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 Aberdeen Emerging and Abrdn Em into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Aberdeen Emerging Markets and Abrdn Em Sma, you can compare the effects of market volatilities on Aberdeen Emerging and Abrdn Em 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 Aberdeen Emerging with a short position of Abrdn Em. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aberdeen Emerging and Abrdn Em.
Diversification Opportunities for Aberdeen Emerging and Abrdn Em
0.91 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Aberdeen and Abrdn is 0.91. Overlapping area represents the amount of risk that can be diversified away by holding Aberdeen Emerging Markets and Abrdn Em Sma in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Abrdn Em Sma and Aberdeen 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 Aberdeen Emerging Markets are associated (or correlated) with Abrdn Em. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Abrdn Em Sma has no effect on the direction of Aberdeen Emerging i.e., Aberdeen Emerging and Abrdn Em go up and down completely randomly.
Pair Corralation between Aberdeen Emerging and Abrdn Em
Assuming the 90 days horizon Aberdeen Emerging Markets is expected to generate 0.99 times more return on investment than Abrdn Em. However, Aberdeen Emerging Markets is 1.01 times less risky than Abrdn Em. It trades about 0.02 of its potential returns per unit of risk. Abrdn Em Sma is currently generating about -0.01 per unit of risk. If you would invest 1,257 in Aberdeen Emerging Markets on August 26, 2024 and sell it today you would earn a total of 110.00 from holding Aberdeen Emerging Markets or generate 8.75% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 77.87% |
| Values | Daily Returns |
Aberdeen Emerging Markets vs. Abrdn Em Sma
Performance |
| Timeline |
| Aberdeen Emerging Markets |
| Abrdn Em Sma |
Aberdeen Emerging and Abrdn Em Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aberdeen Emerging and Abrdn Em
The main advantage of trading using opposite Aberdeen Emerging and Abrdn Em positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aberdeen Emerging position performs unexpectedly, Abrdn Em 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 Em will offset losses from the drop in Abrdn Em's long position.| Aberdeen Emerging vs. Davis Financial Fund | Aberdeen Emerging vs. 1919 Financial Services | Aberdeen Emerging vs. John Hancock Financial | Aberdeen Emerging vs. Prudential Jennison Financial |
| Abrdn Em vs. Aberdeen Emerging Markets | Abrdn Em vs. Aberdeen Emerging Markets | Abrdn Em vs. Aberdeen Emerging Markets | Abrdn Em vs. Aberdeen Gbl Eq |
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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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