Correlation Between Bny Mellon and American Beacon
Can any of the company-specific risk be diversified away by investing in both Bny Mellon 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 Bny Mellon and American Beacon into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bny Mellon Focused and American Beacon Bridgeway, you can compare the effects of market volatilities on Bny Mellon 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 Bny Mellon with a short position of American Beacon. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bny Mellon and American Beacon.
Diversification Opportunities for Bny Mellon and American Beacon
0.74 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Bny and American is 0.74. Overlapping area represents the amount of risk that can be diversified away by holding Bny Mellon Focused and American Beacon Bridgeway in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on American Beacon Bridgeway and Bny Mellon 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 Bny Mellon Focused 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 Bridgeway has no effect on the direction of Bny Mellon i.e., Bny Mellon and American Beacon go up and down completely randomly.
Pair Corralation between Bny Mellon and American Beacon
If you would invest 2,709 in American Beacon Bridgeway on August 26, 2024 and sell it today you would earn a total of 156.00 from holding American Beacon Bridgeway or generate 5.76% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 4.55% |
| Values | Daily Returns |
Bny Mellon Focused vs. American Beacon Bridgeway
Performance |
| Timeline |
| Bny Mellon Focused |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| American Beacon Bridgeway |
Bny Mellon and American Beacon Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bny Mellon and American Beacon
The main advantage of trading using opposite Bny Mellon and American Beacon positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bny Mellon 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.The idea behind Bny Mellon Focused and American Beacon Bridgeway pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| American Beacon vs. American Beacon Bridgeway | American Beacon vs. Small Cap Value Fund | American Beacon vs. Managed Volatility Fund | American Beacon vs. Ultra Small Pany Market |
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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
Other Complementary Tools
| Cryptocurrency Center Build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency | |
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine | |
| Commodity Channel Use Commodity Channel Index to analyze current equity momentum | |
| Funds Screener Find actively-traded funds from around the world traded on over 30 global exchanges | |
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets |