Correlation Between Aig Government and Foreign Value
Can any of the company-specific risk be diversified away by investing in both Aig Government and Foreign Value 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 Foreign Value 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 Foreign Value Fund, you can compare the effects of market volatilities on Aig Government and Foreign Value 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 Foreign Value. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aig Government and Foreign Value.
Diversification Opportunities for Aig Government and Foreign Value
0.71 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Aig and Foreign is 0.71. Overlapping area represents the amount of risk that can be diversified away by holding Aig Government Money and Foreign Value Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Foreign 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 Foreign Value. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Foreign Value has no effect on the direction of Aig Government i.e., Aig Government and Foreign Value go up and down completely randomly.
Pair Corralation between Aig Government and Foreign Value
Assuming the 90 days horizon Aig Government Money is expected to generate 0.32 times more return on investment than Foreign Value. However, Aig Government Money is 3.11 times less risky than Foreign Value. It trades about 0.19 of its potential returns per unit of risk. Foreign Value Fund is currently generating about 0.05 per unit of risk. If you would invest 1,006 in Aig Government Money on September 5, 2024 and sell it today you would earn a total of 10.00 from holding Aig Government Money or generate 0.99% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.45% |
| Values | Daily Returns |
Aig Government Money vs. Foreign Value Fund
Performance |
| Timeline |
| Aig Government Money |
| Foreign Value |
Aig Government and Foreign Value Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aig Government and Foreign Value
The main advantage of trading using opposite Aig Government and Foreign Value positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aig Government position performs unexpectedly, Foreign Value 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 Foreign Value will offset losses from the drop in Foreign Value'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 |
| Foreign Value vs. Mid Cap Index | Foreign Value vs. Mid Cap Strategic | Foreign Value vs. Valic Company I | Foreign Value vs. Valic Company I |
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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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