Correlation Between Highland Floating and Alliancebernstein
Can any of the company-specific risk be diversified away by investing in both Highland Floating and Alliancebernstein 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 Highland Floating and Alliancebernstein into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Highland Floating Rate and Alliancebernstein Global High, you can compare the effects of market volatilities on Highland Floating and Alliancebernstein 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 Highland Floating with a short position of Alliancebernstein. Check out your portfolio center. Please also check ongoing floating volatility patterns of Highland Floating and Alliancebernstein.
Diversification Opportunities for Highland Floating and Alliancebernstein
0.71 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Highland and Alliancebernstein is 0.71. Overlapping area represents the amount of risk that can be diversified away by holding Highland Floating Rate and Alliancebernstein Global High in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Alliancebernstein and Highland Floating 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 Highland Floating Rate are associated (or correlated) with Alliancebernstein. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Alliancebernstein has no effect on the direction of Highland Floating i.e., Highland Floating and Alliancebernstein go up and down completely randomly.
Pair Corralation between Highland Floating and Alliancebernstein
Given the investment horizon of 90 days Highland Floating Rate is expected to under-perform the Alliancebernstein. In addition to that, Highland Floating is 3.13 times more volatile than Alliancebernstein Global High. It trades about -0.04 of its total potential returns per unit of risk. Alliancebernstein Global High is currently generating about 0.11 per unit of volatility. If you would invest 890.00 in Alliancebernstein Global High on August 28, 2024 and sell it today you would earn a total of 202.00 from holding Alliancebernstein Global High or generate 22.7% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 99.72% |
| Values | Daily Returns |
Highland Floating Rate vs. Alliancebernstein Global High
Performance |
| Timeline |
| Highland Floating Rate |
| Alliancebernstein |
Highland Floating and Alliancebernstein Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Highland Floating and Alliancebernstein
The main advantage of trading using opposite Highland Floating and Alliancebernstein positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Highland Floating position performs unexpectedly, Alliancebernstein 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 Alliancebernstein will offset losses from the drop in Alliancebernstein's long position.| Highland Floating vs. Neuberger Berman Next | Highland Floating vs. SRH Total Return | Highland Floating vs. Nuveen Municipal Credit | Highland Floating vs. Doubleline Income Solutions |
| Alliancebernstein vs. Doubleline Yield Opportunities | Alliancebernstein vs. Highland Floating Rate | Alliancebernstein vs. Doubleline Opportunistic Credit | Alliancebernstein vs. Western Asset Emerging |
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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