Correlation Between Kurv Technology and American Beacon
Can any of the company-specific risk be diversified away by investing in both Kurv Technology and American Beacon 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 Kurv Technology and American Beacon into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kurv Technology Titans and American Beacon Select, you can compare the effects of market volatilities on Kurv Technology and American Beacon 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 Kurv Technology with a short position of American Beacon. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kurv Technology and American Beacon.
Diversification Opportunities for Kurv Technology and American Beacon
0.83 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Kurv and American is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding Kurv Technology Titans and American Beacon Select in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on American Beacon Select and Kurv Technology 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 Kurv Technology Titans are associated (or correlated) with American Beacon. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of American Beacon Select has no effect on the direction of Kurv Technology i.e., Kurv Technology and American Beacon go up and down completely randomly.
Pair Corralation between Kurv Technology and American Beacon
Given the investment horizon of 90 days Kurv Technology Titans is expected to generate 1.03 times more return on investment than American Beacon. However, Kurv Technology is 1.03 times more volatile than American Beacon Select. It trades about 0.2 of its potential returns per unit of risk. American Beacon Select is currently generating about 0.14 per unit of risk. If you would invest 2,671 in Kurv Technology Titans on September 13, 2024 and sell it today you would earn a total of 121.00 from holding Kurv Technology Titans or generate 4.53% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 95.45% |
| Values | Daily Returns |
Kurv Technology Titans vs. American Beacon Select
Performance |
| Timeline |
| Kurv Technology Titans |
| American Beacon Select |
Kurv Technology and American Beacon Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kurv Technology and American Beacon
The main advantage of trading using opposite Kurv Technology and American Beacon positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kurv Technology position performs unexpectedly, American Beacon 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 American Beacon will offset losses from the drop in American Beacon's long position.| Kurv Technology vs. Invesco DWA Utilities | Kurv Technology vs. Invesco Dynamic Large | Kurv Technology vs. SCOR PK | Kurv Technology vs. Morningstar Unconstrained Allocation |
| American Beacon vs. Columbia Emerging Markets | American Beacon vs. Direxion Daily Homebuilders | American Beacon vs. Direxion Daily Cnsmr | American Beacon vs. Fidelity MSCI Consumer |
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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
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