Correlation Between Aig Government and Aberdeen Emerging
Can any of the company-specific risk be diversified away by investing in both Aig Government and Aberdeen 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 Aberdeen 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 Aberdeen Emerging Markets, you can compare the effects of market volatilities on Aig Government and Aberdeen 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 Aberdeen Emerging. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aig Government and Aberdeen Emerging.
Diversification Opportunities for Aig Government and Aberdeen Emerging
0.49 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Aig and Aberdeen is 0.49. Overlapping area represents the amount of risk that can be diversified away by holding Aig Government Money and Aberdeen Emerging Markets in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aberdeen 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 Aberdeen Emerging. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aberdeen Emerging Markets has no effect on the direction of Aig Government i.e., Aig Government and Aberdeen Emerging go up and down completely randomly.
Pair Corralation between Aig Government and Aberdeen Emerging
Assuming the 90 days horizon Aig Government is expected to generate 2.29 times less return on investment than Aberdeen Emerging. But when comparing it to its historical volatility, Aig Government Money is 4.92 times less risky than Aberdeen Emerging. It trades about 0.24 of its potential returns per unit of risk. Aberdeen Emerging Markets is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest 1,342 in Aberdeen Emerging Markets on November 9, 2024 and sell it today you would earn a total of 28.00 from holding Aberdeen Emerging Markets or generate 2.09% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.24% |
| Values | Daily Returns |
Aig Government Money vs. Aberdeen Emerging Markets
Performance |
| Timeline |
| Aig Government Money |
| Aberdeen Emerging Markets |
Aig Government and Aberdeen Emerging Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aig Government and Aberdeen Emerging
The main advantage of trading using opposite Aig Government and Aberdeen Emerging positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aig Government position performs unexpectedly, Aberdeen 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 Aberdeen Emerging will offset losses from the drop in Aberdeen Emerging's long position.| Aig Government vs. Elfun Government Money | Aig Government vs. Jpmorgan Government Bond | Aig Government vs. Dws Government Money | Aig Government vs. John Hancock Government |
| Aberdeen Emerging vs. Financials Ultrasector Profund | Aberdeen Emerging vs. Prudential Financial Services | Aberdeen Emerging vs. 1919 Financial Services | Aberdeen Emerging 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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
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