Correlation Between Aig Government and Ashmore Emerging
Can any of the company-specific risk be diversified away by investing in both Aig Government and Ashmore Emerging 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 Ashmore Emerging 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 Ashmore Emerging Markets, you can compare the effects of market volatilities on Aig Government and Ashmore Emerging 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 Ashmore Emerging. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aig Government and Ashmore Emerging.
Diversification Opportunities for Aig Government and Ashmore Emerging
-0.1 | Correlation Coefficient |
Good diversification
The 3 months correlation between Aig and Ashmore is -0.1. Overlapping area represents the amount of risk that can be diversified away by holding Aig Government Money and Ashmore Emerging Markets in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ashmore Emerging Markets 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 Ashmore Emerging. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ashmore Emerging Markets has no effect on the direction of Aig Government i.e., Aig Government and Ashmore Emerging go up and down completely randomly.
Pair Corralation between Aig Government and Ashmore Emerging
Assuming the 90 days horizon Aig Government Money is expected to generate 0.12 times more return on investment than Ashmore Emerging. However, Aig Government Money is 8.3 times less risky than Ashmore Emerging. It trades about 0.49 of its potential returns per unit of risk. Ashmore Emerging Markets is currently generating about -0.04 per unit of risk. If you would invest 1,007 in Aig Government Money on September 12, 2024 and sell it today you would earn a total of 11.00 from holding Aig Government Money or generate 1.09% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.45% |
| Values | Daily Returns |
Aig Government Money vs. Ashmore Emerging Markets
Performance |
| Timeline |
| Aig Government Money |
| Ashmore Emerging Markets |
Aig Government and Ashmore Emerging Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aig Government and Ashmore Emerging
The main advantage of trading using opposite Aig Government and Ashmore Emerging positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aig Government position performs unexpectedly, Ashmore Emerging 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 Ashmore Emerging will offset losses from the drop in Ashmore Emerging'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 |
| Ashmore Emerging vs. Aig Government Money | Ashmore Emerging vs. Schwab Government Money | Ashmore Emerging vs. Ridgeworth Seix Government | Ashmore Emerging vs. Inverse Government Long |
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 Portfolio Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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