Correlation Between Ab Small and Valic Company
Can any of the company-specific risk be diversified away by investing in both Ab Small and Valic Company 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 Valic Company 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 Valic Company I, you can compare the effects of market volatilities on Ab Small and Valic Company 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 Valic Company. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ab Small and Valic Company.
Diversification Opportunities for Ab Small and Valic Company
0.99 | Correlation Coefficient |
No risk reduction
The 3 months correlation between SCYVX and Valic is 0.99. Overlapping area represents the amount of risk that can be diversified away by holding Ab Small Cap and Valic Company I in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Valic Company I 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 Valic Company. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Valic Company I has no effect on the direction of Ab Small i.e., Ab Small and Valic Company go up and down completely randomly.
Pair Corralation between Ab Small and Valic Company
Assuming the 90 days horizon Ab Small is expected to generate 1.45 times less return on investment than Valic Company. But when comparing it to its historical volatility, Ab Small Cap is 1.08 times less risky than Valic Company. It trades about 0.14 of its potential returns per unit of risk. Valic Company I is currently generating about 0.19 of returns per unit of risk over similar time horizon. If you would invest 1,266 in Valic Company I on October 20, 2024 and sell it today you would earn a total of 47.00 from holding Valic Company I or generate 3.71% 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. Valic Company I
Performance |
| Timeline |
| Ab Small Cap |
| Valic Company I |
Ab Small and Valic Company Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ab Small and Valic Company
The main advantage of trading using opposite Ab Small and Valic Company positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ab Small position performs unexpectedly, Valic Company 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 Valic Company will offset losses from the drop in Valic Company's long position.| Ab Small vs. Victory Incore Investment | Ab Small vs. Gabelli Convertible And | Ab Small vs. Allianzgi Convertible Income | Ab Small vs. Rationalpier 88 Convertible |
| Valic Company vs. Short Duration Inflation | Valic Company vs. Ab Bond Inflation | Valic Company vs. Inflation Protected Bond Fund | Valic Company vs. Ab Bond Inflation |
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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
Other Complementary Tools
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine | |
| Money Flow Index Determine momentum by analyzing Money Flow Index and other technical indicators | |
| Bonds Directory Find actively traded corporate debentures issued by US companies | |
| Headlines Timeline Stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity | |
| Portfolio Center All portfolio management and optimization tools to improve performance of your portfolios |