Correlation Between Ab Small and James Alpha
Can any of the company-specific risk be diversified away by investing in both Ab Small and James Alpha 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 James Alpha 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 James Alpha Global, you can compare the effects of market volatilities on Ab Small and James Alpha 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 James Alpha. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ab Small and James Alpha.
Diversification Opportunities for Ab Small and James Alpha
-0.64 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between SCYVX and James is -0.64. Overlapping area represents the amount of risk that can be diversified away by holding Ab Small Cap and James Alpha Global in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on James Alpha Global 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 James Alpha. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of James Alpha Global has no effect on the direction of Ab Small i.e., Ab Small and James Alpha go up and down completely randomly.
Pair Corralation between Ab Small and James Alpha
Assuming the 90 days horizon Ab Small Cap is expected to generate 2.03 times more return on investment than James Alpha. However, Ab Small is 2.03 times more volatile than James Alpha Global. It trades about 0.25 of its potential returns per unit of risk. James Alpha Global is currently generating about -0.03 per unit of risk. If you would invest 1,505 in Ab Small Cap on August 30, 2024 and sell it today you would earn a total of 136.00 from holding Ab Small Cap or generate 9.04% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
Ab Small Cap vs. James Alpha Global
Performance |
| Timeline |
| Ab Small Cap |
| James Alpha Global |
Ab Small and James Alpha Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ab Small and James Alpha
The main advantage of trading using opposite Ab Small and James Alpha positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ab Small position performs unexpectedly, James Alpha 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 James Alpha will offset losses from the drop in James Alpha's long position.| Ab Small vs. Ab Global E | Ab Small vs. Ab Global E | Ab Small vs. Ab Global E | Ab Small vs. Ab Minnesota Portfolio |
| James Alpha vs. Growth Fund Of | James Alpha vs. Issachar Fund Class | James Alpha vs. Ab Value Fund | James Alpha vs. Ab Small Cap |
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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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