Correlation Between Aberdeen Emerging and Aberdeen
Can any of the company-specific risk be diversified away by investing in both Aberdeen Emerging and Aberdeen 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 Aberdeen 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 Aberdeen Multi Cap Equity, you can compare the effects of market volatilities on Aberdeen Emerging and Aberdeen 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 Aberdeen. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aberdeen Emerging and Aberdeen.
Diversification Opportunities for Aberdeen Emerging and Aberdeen
0.34 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Aberdeen and Aberdeen is 0.34. Overlapping area represents the amount of risk that can be diversified away by holding Aberdeen Emerging Markets and Aberdeen Multi Cap Equity in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aberdeen Multi Cap 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 Aberdeen. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aberdeen Multi Cap has no effect on the direction of Aberdeen Emerging i.e., Aberdeen Emerging and Aberdeen go up and down completely randomly.
Pair Corralation between Aberdeen Emerging and Aberdeen
Assuming the 90 days horizon Aberdeen Emerging is expected to generate 1.93 times less return on investment than Aberdeen. In addition to that, Aberdeen Emerging is 1.04 times more volatile than Aberdeen Multi Cap Equity. It trades about 0.02 of its total potential returns per unit of risk. Aberdeen Multi Cap Equity is currently generating about 0.05 per unit of volatility. If you would invest 710.00 in Aberdeen Multi Cap Equity on August 26, 2024 and sell it today you would earn a total of 154.00 from holding Aberdeen Multi Cap Equity or generate 21.69% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Aberdeen Emerging Markets vs. Aberdeen Multi Cap Equity
Performance |
| Timeline |
| Aberdeen Emerging Markets |
| Aberdeen Multi Cap |
Aberdeen Emerging and Aberdeen Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aberdeen Emerging and Aberdeen
The main advantage of trading using opposite Aberdeen Emerging and Aberdeen positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aberdeen Emerging position performs unexpectedly, Aberdeen 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 Aberdeen will offset losses from the drop in Aberdeen's long position.| Aberdeen Emerging vs. Aberdeen Emerging Markets | Aberdeen Emerging vs. Aberdeen Emerging Markets | Aberdeen Emerging vs. Aberdeen Gbl Eq | Aberdeen Emerging vs. Aberdeen Gbl Eq |
| Aberdeen vs. Pender Real Estate | Aberdeen vs. Deutsche Real Estate | Aberdeen vs. Prudential Real Estate | Aberdeen vs. Jhancock Real Estate |
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 Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
Other Complementary Tools
| Price Transformation Use Price Transformation models to analyze the depth of different equity instruments across global markets | |
| Headlines Timeline Stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity | |
| AI Portfolio Architect Use AI to generate optimal portfolios and find profitable investment opportunities | |
| Global Markets Map Get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes | |
| Price Ceiling Movement Calculate and plot Price Ceiling Movement for different equity instruments |