Correlation Between Aberdeen Gbl and Aberdeen Emerging
Can any of the company-specific risk be diversified away by investing in both Aberdeen Gbl 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 Aberdeen Gbl and Aberdeen Emerging 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 Aberdeen Emerging Markets, you can compare the effects of market volatilities on Aberdeen Gbl 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 Aberdeen Gbl with a short position of Aberdeen Emerging. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aberdeen Gbl and Aberdeen Emerging.
Diversification Opportunities for Aberdeen Gbl and Aberdeen Emerging
0.52 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Aberdeen and Aberdeen is 0.52. Overlapping area represents the amount of risk that can be diversified away by holding Aberdeen Gbl Eq 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 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 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 Aberdeen Gbl i.e., Aberdeen Gbl and Aberdeen Emerging go up and down completely randomly.
Pair Corralation between Aberdeen Gbl and Aberdeen Emerging
Assuming the 90 days horizon Aberdeen Gbl is expected to generate 1.4 times less return on investment than Aberdeen Emerging. But when comparing it to its historical volatility, Aberdeen Gbl Eq is 1.07 times less risky than Aberdeen Emerging. It trades about 0.02 of its potential returns per unit of risk. Aberdeen Emerging Markets is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 1,318 in Aberdeen Emerging Markets on August 29, 2024 and sell it today you would earn a total of 46.00 from holding Aberdeen Emerging Markets or generate 3.49% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Aberdeen Gbl Eq vs. Aberdeen Emerging Markets
Performance |
| Timeline |
| Aberdeen Gbl Eq |
| Aberdeen Emerging Markets |
Aberdeen Gbl and Aberdeen Emerging Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aberdeen Gbl and Aberdeen Emerging
The main advantage of trading using opposite Aberdeen Gbl and Aberdeen Emerging positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aberdeen Gbl 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.| Aberdeen Gbl vs. Msift High Yield | Aberdeen Gbl vs. Tiaa Cref High Yield Fund | Aberdeen Gbl vs. Pia High Yield | Aberdeen Gbl vs. Virtus High Yield |
| Aberdeen Emerging vs. Vanguard Emerging Markets | Aberdeen Emerging vs. Vanguard Emerging Markets | Aberdeen Emerging vs. HUMANA INC | Aberdeen Emerging vs. Aquagold International |
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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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