Correlation Between Aberdeen Select and Aberdeen China
Can any of the company-specific risk be diversified away by investing in both Aberdeen Select and Aberdeen China 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 Select and Aberdeen China into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Aberdeen Select International and Aberdeen China Oppty, you can compare the effects of market volatilities on Aberdeen Select and Aberdeen China 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 Select with a short position of Aberdeen China. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aberdeen Select and Aberdeen China.
Diversification Opportunities for Aberdeen Select and Aberdeen China
0.78 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Aberdeen and Aberdeen is 0.78. Overlapping area represents the amount of risk that can be diversified away by holding Aberdeen Select International and Aberdeen China Oppty in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aberdeen China Oppty and Aberdeen Select 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 Select International are associated (or correlated) with Aberdeen China. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aberdeen China Oppty has no effect on the direction of Aberdeen Select i.e., Aberdeen Select and Aberdeen China go up and down completely randomly.
Pair Corralation between Aberdeen Select and Aberdeen China
Assuming the 90 days horizon Aberdeen Select is expected to generate 2.78 times less return on investment than Aberdeen China. But when comparing it to its historical volatility, Aberdeen Select International is 1.68 times less risky than Aberdeen China. It trades about 0.03 of its potential returns per unit of risk. Aberdeen China Oppty is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 2,044 in Aberdeen China Oppty on September 1, 2024 and sell it today you would earn a total of 173.00 from holding Aberdeen China Oppty or generate 8.46% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Aberdeen Select International vs. Aberdeen China Oppty
Performance |
| Timeline |
| Aberdeen Select Inte |
| Aberdeen China Oppty |
Aberdeen Select and Aberdeen China Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aberdeen Select and Aberdeen China
The main advantage of trading using opposite Aberdeen Select and Aberdeen China positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aberdeen Select position performs unexpectedly, Aberdeen China 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 China will offset losses from the drop in Aberdeen China's long position.| Aberdeen Select vs. Legg Mason Partners | Aberdeen Select vs. Lgm Risk Managed | Aberdeen Select vs. Pioneer High Yield | Aberdeen Select vs. Ab High Income |
| Aberdeen China vs. Virtus Convertible | Aberdeen China vs. Harbor Vertible Securities | Aberdeen China vs. Advent Claymore Convertible | Aberdeen China vs. The Gamco Global |
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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
Other Complementary Tools
| Investing Opportunities Build portfolios using our predefined set of ideas and optimize them against your investing preferences | |
| Headlines Timeline Stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity | |
| Odds Of Bankruptcy Get analysis of equity chance of financial distress in the next 2 years | |
| Pattern Recognition Use different Pattern Recognition models to time the market across multiple global exchanges | |
| Global Markets Map Get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes |