Correlation Between NBI Unconstrained and Accelerate Absolute
Can any of the company-specific risk be diversified away by investing in both NBI Unconstrained and Accelerate Absolute 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 NBI Unconstrained and Accelerate Absolute into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between NBI Unconstrained Fixed and Accelerate Absolute Return, you can compare the effects of market volatilities on NBI Unconstrained and Accelerate Absolute 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 NBI Unconstrained with a short position of Accelerate Absolute. Check out your portfolio center. Please also check ongoing floating volatility patterns of NBI Unconstrained and Accelerate Absolute.
Diversification Opportunities for NBI Unconstrained and Accelerate Absolute
0.27 | Correlation Coefficient |
Modest diversification
The 3 months correlation between NBI and Accelerate is 0.27. Overlapping area represents the amount of risk that can be diversified away by holding NBI Unconstrained Fixed and Accelerate Absolute Return in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Accelerate Absolute and NBI Unconstrained 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 NBI Unconstrained Fixed are associated (or correlated) with Accelerate Absolute. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Accelerate Absolute has no effect on the direction of NBI Unconstrained i.e., NBI Unconstrained and Accelerate Absolute go up and down completely randomly.
Pair Corralation between NBI Unconstrained and Accelerate Absolute
Assuming the 90 days trading horizon NBI Unconstrained Fixed is expected to generate 0.38 times more return on investment than Accelerate Absolute. However, NBI Unconstrained Fixed is 2.6 times less risky than Accelerate Absolute. It trades about 0.17 of its potential returns per unit of risk. Accelerate Absolute Return is currently generating about 0.01 per unit of risk. If you would invest 2,081 in NBI Unconstrained Fixed on November 30, 2024 and sell it today you would earn a total of 54.00 from holding NBI Unconstrained Fixed or generate 2.59% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
NBI Unconstrained Fixed vs. Accelerate Absolute Return
Performance |
| Timeline |
| NBI Unconstrained Fixed |
| Accelerate Absolute |
NBI Unconstrained and Accelerate Absolute Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with NBI Unconstrained and Accelerate Absolute
The main advantage of trading using opposite NBI Unconstrained and Accelerate Absolute positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NBI Unconstrained position performs unexpectedly, Accelerate Absolute 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 Accelerate Absolute will offset losses from the drop in Accelerate Absolute's long position.| NBI Unconstrained vs. NBI High Yield | NBI Unconstrained vs. NBI Active Canadian | NBI Unconstrained vs. Picton Mahoney Fortified | NBI Unconstrained vs. NBI Liquid Alternatives |
| Accelerate Absolute vs. Accelerate Arbitrage | Accelerate Absolute vs. Accelerate OneChoice Alternative | Accelerate Absolute vs. NBI High Yield | Accelerate Absolute vs. NBI Unconstrained Fixed |
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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
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