Correlation Between Aig Government and Johnson Opportunity
Can any of the company-specific risk be diversified away by investing in both Aig Government and Johnson Opportunity 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 Johnson Opportunity 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 Johnson Opportunity S, you can compare the effects of market volatilities on Aig Government and Johnson Opportunity 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 Johnson Opportunity. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aig Government and Johnson Opportunity.
Diversification Opportunities for Aig Government and Johnson Opportunity
-0.21 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Aig and Johnson is -0.21. Overlapping area represents the amount of risk that can be diversified away by holding Aig Government Money and Johnson Opportunity S in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Johnson Opportunity 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 Johnson Opportunity. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Johnson Opportunity has no effect on the direction of Aig Government i.e., Aig Government and Johnson Opportunity go up and down completely randomly.
Pair Corralation between Aig Government and Johnson Opportunity
Assuming the 90 days horizon Aig Government Money is expected to generate 0.13 times more return on investment than Johnson Opportunity. However, Aig Government Money is 7.81 times less risky than Johnson Opportunity. It trades about 0.56 of its potential returns per unit of risk. Johnson Opportunity S is currently generating about -0.02 per unit of risk. If you would invest 1,006 in Aig Government Money on September 13, 2024 and sell it today you would earn a total of 12.00 from holding Aig Government Money or generate 1.19% 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. Johnson Opportunity S
Performance |
| Timeline |
| Aig Government Money |
| Johnson Opportunity |
Aig Government and Johnson Opportunity Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aig Government and Johnson Opportunity
The main advantage of trading using opposite Aig Government and Johnson Opportunity positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aig Government position performs unexpectedly, Johnson Opportunity 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 Johnson Opportunity will offset losses from the drop in Johnson Opportunity's long position.| Aig Government vs. Simt Multi Asset Accumulation | Aig Government vs. Saat Market Growth | Aig Government vs. Simt Real Return | Aig Government vs. Simt Small Cap |
| Johnson Opportunity vs. Johnson Core Plus | Johnson Opportunity vs. Johnson Enhanced Return | Johnson Opportunity vs. Johnson Equity Income | Johnson Opportunity vs. Johnson Mutual Funds |
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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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