Correlation Between Accelerate Absolute and NBI Unconstrained
Can any of the company-specific risk be diversified away by investing in both Accelerate Absolute and NBI Unconstrained 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 Accelerate Absolute and NBI Unconstrained into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Accelerate Absolute Return and NBI Unconstrained Fixed, you can compare the effects of market volatilities on Accelerate Absolute and NBI Unconstrained 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 Accelerate Absolute with a short position of NBI Unconstrained. Check out your portfolio center. Please also check ongoing floating volatility patterns of Accelerate Absolute and NBI Unconstrained.
Diversification Opportunities for Accelerate Absolute and NBI Unconstrained
-0.47 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Accelerate and NBI is -0.47. Overlapping area represents the amount of risk that can be diversified away by holding Accelerate Absolute Return and NBI Unconstrained Fixed in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NBI Unconstrained Fixed and Accelerate Absolute 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 Accelerate Absolute Return are associated (or correlated) with NBI Unconstrained. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NBI Unconstrained Fixed has no effect on the direction of Accelerate Absolute i.e., Accelerate Absolute and NBI Unconstrained go up and down completely randomly.
Pair Corralation between Accelerate Absolute and NBI Unconstrained
Assuming the 90 days trading horizon Accelerate Absolute Return is expected to generate 2.1 times more return on investment than NBI Unconstrained. However, Accelerate Absolute is 2.1 times more volatile than NBI Unconstrained Fixed. It trades about 0.07 of its potential returns per unit of risk. NBI Unconstrained Fixed is currently generating about 0.04 per unit of risk. If you would invest 2,142 in Accelerate Absolute Return on September 1, 2024 and sell it today you would earn a total of 681.00 from holding Accelerate Absolute Return or generate 31.79% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Accelerate Absolute Return vs. NBI Unconstrained Fixed
Performance |
| Timeline |
| Accelerate Absolute |
| NBI Unconstrained Fixed |
Accelerate Absolute and NBI Unconstrained Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Accelerate Absolute and NBI Unconstrained
The main advantage of trading using opposite Accelerate Absolute and NBI Unconstrained positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Accelerate Absolute position performs unexpectedly, NBI Unconstrained 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 NBI Unconstrained will offset losses from the drop in NBI Unconstrained's long position.| Accelerate Absolute vs. Accelerate Arbitrage | Accelerate Absolute vs. Accelerate OneChoice Alternative | Accelerate Absolute vs. NBI High Yield | Accelerate Absolute vs. NBI Unconstrained Fixed |
| NBI Unconstrained vs. NBI High Yield | NBI Unconstrained vs. NBI Active Canadian | NBI Unconstrained vs. Picton Mahoney Fortified | NBI Unconstrained vs. NBI Liquid Alternatives |
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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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