Correlation Between Guggenheim High and Aberdeen
Can any of the company-specific risk be diversified away by investing in both Guggenheim High and Aberdeen 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 Guggenheim High and Aberdeen into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Guggenheim High Yield and Aberdeen Eq Long Short, you can compare the effects of market volatilities on Guggenheim High and Aberdeen 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 Guggenheim High with a short position of Aberdeen. Check out your portfolio center. Please also check ongoing floating volatility patterns of Guggenheim High and Aberdeen.
Diversification Opportunities for Guggenheim High and Aberdeen
0.61 | Correlation Coefficient |
Poor diversification
The 3 months correlation between GUGGENHEIM and Aberdeen is 0.61. Overlapping area represents the amount of risk that can be diversified away by holding Guggenheim High Yield and Aberdeen Eq Long Short in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aberdeen Eq Long and Guggenheim High 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 Guggenheim High Yield are associated (or correlated) with Aberdeen. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aberdeen Eq Long has no effect on the direction of Guggenheim High i.e., Guggenheim High and Aberdeen go up and down completely randomly.
Pair Corralation between Guggenheim High and Aberdeen
Assuming the 90 days horizon Guggenheim High is expected to generate 4.13 times less return on investment than Aberdeen. But when comparing it to its historical volatility, Guggenheim High Yield is 7.29 times less risky than Aberdeen. It trades about 0.22 of its potential returns per unit of risk. Aberdeen Eq Long Short is currently generating about 0.12 of returns per unit of risk over similar time horizon. If you would invest 805.00 in Aberdeen Eq Long Short on September 3, 2024 and sell it today you would earn a total of 158.00 from holding Aberdeen Eq Long Short or generate 19.63% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Guggenheim High Yield vs. Aberdeen Eq Long Short
Performance |
| Timeline |
| Guggenheim High Yield |
| Aberdeen Eq Long |
Guggenheim High and Aberdeen Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Guggenheim High and Aberdeen
The main advantage of trading using opposite Guggenheim High and Aberdeen positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Guggenheim High position performs unexpectedly, Aberdeen 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 Aberdeen will offset losses from the drop in Aberdeen's long position.| Guggenheim High vs. Vanguard High Yield Corporate | Guggenheim High vs. Vanguard High Yield Porate | Guggenheim High vs. Blackrock Hi Yld | Guggenheim High vs. Blackrock High Yield |
| Aberdeen vs. Morningstar Aggressive Growth | Aberdeen vs. Guggenheim High Yield | Aberdeen vs. Pace High Yield | Aberdeen vs. Vanguard Star Fund |
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 Directory module to find actively traded commodities issued by global exchanges.
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