Correlation Between Aberdeen Global and Aberdeen Short
Can any of the company-specific risk be diversified away by investing in both Aberdeen Global and Aberdeen Short 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 Global and Aberdeen Short into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Aberdeen Global Equty and Aberdeen Short Duration, you can compare the effects of market volatilities on Aberdeen Global and Aberdeen Short 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 Global with a short position of Aberdeen Short. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aberdeen Global and Aberdeen Short.
Diversification Opportunities for Aberdeen Global and Aberdeen Short
0.22 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Aberdeen and Aberdeen is 0.22. Overlapping area represents the amount of risk that can be diversified away by holding Aberdeen Global Equty and Aberdeen Short Duration in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aberdeen Short Duration and Aberdeen 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 Aberdeen Global Equty are associated (or correlated) with Aberdeen Short. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aberdeen Short Duration has no effect on the direction of Aberdeen Global i.e., Aberdeen Global and Aberdeen Short go up and down completely randomly.
Pair Corralation between Aberdeen Global and Aberdeen Short
Assuming the 90 days horizon Aberdeen Global Equty is expected to generate 5.26 times more return on investment than Aberdeen Short. However, Aberdeen Global is 5.26 times more volatile than Aberdeen Short Duration. It trades about -0.07 of its potential returns per unit of risk. Aberdeen Short Duration is currently generating about -0.36 per unit of risk. If you would invest 1,263 in Aberdeen Global Equty on October 9, 2024 and sell it today you would lose (14.00) from holding Aberdeen Global Equty or give up 1.11% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Aberdeen Global Equty vs. Aberdeen Short Duration
Performance |
| Timeline |
| Aberdeen Global Equty |
| Aberdeen Short Duration |
Aberdeen Global and Aberdeen Short Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aberdeen Global and Aberdeen Short
The main advantage of trading using opposite Aberdeen Global and Aberdeen Short positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aberdeen Global position performs unexpectedly, Aberdeen Short 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 Short will offset losses from the drop in Aberdeen Short's long position.| Aberdeen Global vs. Jhancock Diversified Macro | Aberdeen Global vs. Wells Fargo Diversified | Aberdeen Global vs. Tax Free Conservative Income | Aberdeen Global vs. Guidepath Conservative Income |
| Aberdeen Short vs. Aberdeen Emerging Markets | Aberdeen Short vs. Aberdeen Emerging Markets | Aberdeen Short vs. Aberdeen Emerging Markets | Aberdeen Short 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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
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