Correlation Between Aig Government and Guardian Dividend
Can any of the company-specific risk be diversified away by investing in both Aig Government and Guardian Dividend 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 Aig Government and Guardian Dividend into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Aig Government Money and Guardian Dividend Growth, you can compare the effects of market volatilities on Aig Government and Guardian Dividend 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 Aig Government with a short position of Guardian Dividend. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aig Government and Guardian Dividend.
Diversification Opportunities for Aig Government and Guardian Dividend
0.46 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Aig and Guardian is 0.46. Overlapping area represents the amount of risk that can be diversified away by holding Aig Government Money and Guardian Dividend Growth in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guardian Dividend Growth and Aig Government 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 Aig Government Money are associated (or correlated) with Guardian Dividend. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guardian Dividend Growth has no effect on the direction of Aig Government i.e., Aig Government and Guardian Dividend go up and down completely randomly.
Pair Corralation between Aig Government and Guardian Dividend
Assuming the 90 days horizon Aig Government is expected to generate 16.88 times less return on investment than Guardian Dividend. But when comparing it to its historical volatility, Aig Government Money is 2.63 times less risky than Guardian Dividend. It trades about 0.01 of its potential returns per unit of risk. Guardian Dividend Growth is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 1,665 in Guardian Dividend Growth on September 12, 2024 and sell it today you would earn a total of 29.00 from holding Guardian Dividend Growth or generate 1.74% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Aig Government Money vs. Guardian Dividend Growth
Performance |
| Timeline |
| Aig Government Money |
| Guardian Dividend Growth |
Aig Government and Guardian Dividend Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aig Government and Guardian Dividend
The main advantage of trading using opposite Aig Government and Guardian Dividend positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aig Government position performs unexpectedly, Guardian Dividend 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 Guardian Dividend will offset losses from the drop in Guardian Dividend's long position.| Aig Government vs. SCOR PK | Aig Government vs. Morningstar Unconstrained Allocation | Aig Government vs. Via Renewables | Aig Government vs. Bondbloxx ETF Trust |
| Guardian Dividend vs. Icon Financial Fund | Guardian Dividend vs. Prudential Jennison Financial | Guardian Dividend vs. 1919 Financial Services | Guardian Dividend vs. Gabelli Global Financial |
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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
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