Correlation Between Aberdeen Gbl and Guidepath Managed
Can any of the company-specific risk be diversified away by investing in both Aberdeen Gbl and Guidepath Managed 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 Gbl and Guidepath Managed into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Aberdeen Gbl Eq and Guidepath Managed Futures, you can compare the effects of market volatilities on Aberdeen Gbl and Guidepath Managed 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 Gbl with a short position of Guidepath Managed. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aberdeen Gbl and Guidepath Managed.
Diversification Opportunities for Aberdeen Gbl and Guidepath Managed
0.53 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Aberdeen and Guidepath is 0.53. Overlapping area represents the amount of risk that can be diversified away by holding Aberdeen Gbl Eq and Guidepath Managed Futures in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guidepath Managed Futures and Aberdeen Gbl 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 Gbl Eq are associated (or correlated) with Guidepath Managed. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guidepath Managed Futures has no effect on the direction of Aberdeen Gbl i.e., Aberdeen Gbl and Guidepath Managed go up and down completely randomly.
Pair Corralation between Aberdeen Gbl and Guidepath Managed
Assuming the 90 days horizon Aberdeen Gbl Eq is expected to generate 0.82 times more return on investment than Guidepath Managed. However, Aberdeen Gbl Eq is 1.23 times less risky than Guidepath Managed. It trades about 0.06 of its potential returns per unit of risk. Guidepath Managed Futures is currently generating about -0.05 per unit of risk. If you would invest 981.00 in Aberdeen Gbl Eq on September 12, 2024 and sell it today you would earn a total of 248.00 from holding Aberdeen Gbl Eq or generate 25.28% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 99.8% |
| Values | Daily Returns |
Aberdeen Gbl Eq vs. Guidepath Managed Futures
Performance |
| Timeline |
| Aberdeen Gbl Eq |
| Guidepath Managed Futures |
Aberdeen Gbl and Guidepath Managed Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aberdeen Gbl and Guidepath Managed
The main advantage of trading using opposite Aberdeen Gbl and Guidepath Managed positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aberdeen Gbl position performs unexpectedly, Guidepath Managed 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 Guidepath Managed will offset losses from the drop in Guidepath Managed's long position.| Aberdeen Gbl vs. Black Oak Emerging | Aberdeen Gbl vs. Angel Oak Multi Strategy | Aberdeen Gbl vs. Vy Jpmorgan Emerging | Aberdeen Gbl vs. Origin Emerging Markets |
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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.
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