Correlation Between Aig Government and Rbc Microcap
Can any of the company-specific risk be diversified away by investing in both Aig Government and Rbc Microcap 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 Rbc Microcap 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 Rbc Microcap Value, you can compare the effects of market volatilities on Aig Government and Rbc Microcap 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 Rbc Microcap. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aig Government and Rbc Microcap.
Diversification Opportunities for Aig Government and Rbc Microcap
-0.19 | Correlation Coefficient |
Good diversification
The 3 months correlation between Aig and Rbc is -0.19. Overlapping area represents the amount of risk that can be diversified away by holding Aig Government Money and Rbc Microcap Value in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Rbc Microcap Value 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 Rbc Microcap. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Rbc Microcap Value has no effect on the direction of Aig Government i.e., Aig Government and Rbc Microcap go up and down completely randomly.
Pair Corralation between Aig Government and Rbc Microcap
Assuming the 90 days horizon Aig Government is expected to generate 9.65 times less return on investment than Rbc Microcap. But when comparing it to its historical volatility, Aig Government Money is 4.77 times less risky than Rbc Microcap. It trades about 0.1 of its potential returns per unit of risk. Rbc Microcap Value is currently generating about 0.19 of returns per unit of risk over similar time horizon. If you would invest 3,019 in Rbc Microcap Value on September 17, 2024 and sell it today you would earn a total of 87.00 from holding Rbc Microcap Value or generate 2.88% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Aig Government Money vs. Rbc Microcap Value
Performance |
| Timeline |
| Aig Government Money |
| Rbc Microcap Value |
Aig Government and Rbc Microcap Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aig Government and Rbc Microcap
The main advantage of trading using opposite Aig Government and Rbc Microcap positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aig Government position performs unexpectedly, Rbc Microcap 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 Rbc Microcap will offset losses from the drop in Rbc Microcap'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 |
| Rbc Microcap vs. Aig Government Money | Rbc Microcap vs. Lord Abbett Government | Rbc Microcap vs. Davis Government Bond | Rbc Microcap vs. Payden Government 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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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