Correlation Between Guggenheim Risk and Aberdeen Emerging
Can any of the company-specific risk be diversified away by investing in both Guggenheim Risk and Aberdeen Emerging 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 Guggenheim Risk and Aberdeen Emerging into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Guggenheim Risk Managed and Aberdeen Emerging Markets, you can compare the effects of market volatilities on Guggenheim Risk and Aberdeen Emerging 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 Guggenheim Risk with a short position of Aberdeen Emerging. Check out your portfolio center. Please also check ongoing floating volatility patterns of Guggenheim Risk and Aberdeen Emerging.
Diversification Opportunities for Guggenheim Risk and Aberdeen Emerging
-0.32 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Guggenheim and Aberdeen is -0.32. Overlapping area represents the amount of risk that can be diversified away by holding Guggenheim Risk Managed and Aberdeen Emerging Markets in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aberdeen Emerging Markets and Guggenheim Risk 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 Guggenheim Risk Managed are associated (or correlated) with Aberdeen Emerging. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aberdeen Emerging Markets has no effect on the direction of Guggenheim Risk i.e., Guggenheim Risk and Aberdeen Emerging go up and down completely randomly.
Pair Corralation between Guggenheim Risk and Aberdeen Emerging
Assuming the 90 days horizon Guggenheim Risk Managed is expected to under-perform the Aberdeen Emerging. In addition to that, Guggenheim Risk is 1.07 times more volatile than Aberdeen Emerging Markets. It trades about -0.02 of its total potential returns per unit of risk. Aberdeen Emerging Markets is currently generating about 0.08 per unit of volatility. If you would invest 1,394 in Aberdeen Emerging Markets on September 13, 2024 and sell it today you would earn a total of 13.00 from holding Aberdeen Emerging Markets or generate 0.93% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Guggenheim Risk Managed vs. Aberdeen Emerging Markets
Performance |
| Timeline |
| Guggenheim Risk Managed |
| Aberdeen Emerging Markets |
Guggenheim Risk and Aberdeen Emerging Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Guggenheim Risk and Aberdeen Emerging
The main advantage of trading using opposite Guggenheim Risk and Aberdeen Emerging positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Guggenheim Risk position performs unexpectedly, Aberdeen Emerging 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 Emerging will offset losses from the drop in Aberdeen Emerging's long position.| Guggenheim Risk vs. Guggenheim Risk Managed | Guggenheim Risk vs. Guggenheim Risk Managed | Guggenheim Risk vs. Guggenheim Risk Managed | Guggenheim Risk vs. Lazard Global Listed |
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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
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