Correlation Between Accelerate OneChoice and Accelerate Absolute
Can any of the company-specific risk be diversified away by investing in both Accelerate OneChoice 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 Accelerate OneChoice and Accelerate Absolute into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Accelerate OneChoice Alternative and Accelerate Absolute Return, you can compare the effects of market volatilities on Accelerate OneChoice 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 Accelerate OneChoice with a short position of Accelerate Absolute. Check out your portfolio center. Please also check ongoing floating volatility patterns of Accelerate OneChoice and Accelerate Absolute.
Diversification Opportunities for Accelerate OneChoice and Accelerate Absolute
0.24 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Accelerate and Accelerate is 0.24. Overlapping area represents the amount of risk that can be diversified away by holding Accelerate OneChoice Alternati and Accelerate Absolute Return in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Accelerate Absolute and Accelerate OneChoice 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 Accelerate OneChoice Alternative 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 Accelerate OneChoice i.e., Accelerate OneChoice and Accelerate Absolute go up and down completely randomly.
Pair Corralation between Accelerate OneChoice and Accelerate Absolute
Assuming the 90 days trading horizon Accelerate OneChoice Alternative is expected to generate 0.56 times more return on investment than Accelerate Absolute. However, Accelerate OneChoice Alternative is 1.79 times less risky than Accelerate Absolute. It trades about 0.09 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 2,312 in Accelerate OneChoice Alternative on November 30, 2024 and sell it today you would earn a total of 49.00 from holding Accelerate OneChoice Alternative or generate 2.12% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Accelerate OneChoice Alternati vs. Accelerate Absolute Return
Performance |
| Timeline |
| Accelerate OneChoice |
| Accelerate Absolute |
Accelerate OneChoice and Accelerate Absolute Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Accelerate OneChoice and Accelerate Absolute
The main advantage of trading using opposite Accelerate OneChoice and Accelerate Absolute positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Accelerate OneChoice 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.| Accelerate OneChoice vs. Accelerate Arbitrage | Accelerate OneChoice vs. Accelerate Absolute Return | Accelerate OneChoice vs. NBI High Yield | Accelerate OneChoice vs. NBI Unconstrained Fixed |
| 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 Portfolio File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
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