Correlation Between Ab Small and Conestoga Smid
Can any of the company-specific risk be diversified away by investing in both Ab Small and Conestoga Smid 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 Ab Small and Conestoga Smid into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ab Small Cap and Conestoga Smid Cap, you can compare the effects of market volatilities on Ab Small and Conestoga Smid 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 Ab Small with a short position of Conestoga Smid. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ab Small and Conestoga Smid.
Diversification Opportunities for Ab Small and Conestoga Smid
0.94 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between SCYVX and Conestoga is 0.94. Overlapping area represents the amount of risk that can be diversified away by holding Ab Small Cap and Conestoga Smid Cap in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Conestoga Smid Cap and Ab Small 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 Ab Small Cap are associated (or correlated) with Conestoga Smid. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Conestoga Smid Cap has no effect on the direction of Ab Small i.e., Ab Small and Conestoga Smid go up and down completely randomly.
Pair Corralation between Ab Small and Conestoga Smid
Assuming the 90 days horizon Ab Small is expected to generate 4.79 times less return on investment than Conestoga Smid. In addition to that, Ab Small is 1.19 times more volatile than Conestoga Smid Cap. It trades about 0.01 of its total potential returns per unit of risk. Conestoga Smid Cap is currently generating about 0.03 per unit of volatility. If you would invest 2,089 in Conestoga Smid Cap on January 12, 2025 and sell it today you would earn a total of 313.00 from holding Conestoga Smid Cap or generate 14.98% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ab Small Cap vs. Conestoga Smid Cap
Performance |
| Timeline |
| Ab Small Cap |
| Conestoga Smid Cap |
Ab Small and Conestoga Smid Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ab Small and Conestoga Smid
The main advantage of trading using opposite Ab Small and Conestoga Smid positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ab Small position performs unexpectedly, Conestoga Smid 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 Conestoga Smid will offset losses from the drop in Conestoga Smid's long position.| Ab Small vs. Calamos Dynamic Convertible | Ab Small vs. Gabelli Convertible And | Ab Small vs. Rationalpier 88 Convertible | Ab Small vs. Virtus Convertible |
| Conestoga Smid vs. Ab Government Exchange | Conestoga Smid vs. Ab Government Exchange | Conestoga Smid vs. Blackrock Financial Institutions | Conestoga Smid vs. Dws Government Money |
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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
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