Correlation Between Snap and AB Active

Specify exactly 2 symbols:
Can any of the company-specific risk be diversified away by investing in both Snap and AB Active 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 Snap and AB Active into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Snap Inc and AB Active ETFs,, you can compare the effects of market volatilities on Snap and AB Active 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 Snap with a short position of AB Active. Check out your portfolio center. Please also check ongoing floating volatility patterns of Snap and AB Active.

Diversification Opportunities for Snap and AB Active

0.77
  Correlation Coefficient

Poor diversification

The 3 months correlation between Snap and LRGC is 0.77. Overlapping area represents the amount of risk that can be diversified away by holding Snap Inc and AB Active ETFs, in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AB Active ETFs, and Snap 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 Snap Inc are associated (or correlated) with AB Active. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AB Active ETFs, has no effect on the direction of Snap i.e., Snap and AB Active go up and down completely randomly.

Pair Corralation between Snap and AB Active

Given the investment horizon of 90 days Snap Inc is expected to generate 5.29 times more return on investment than AB Active. However, Snap is 5.29 times more volatile than AB Active ETFs,. It trades about 0.1 of its potential returns per unit of risk. AB Active ETFs, is currently generating about 0.18 per unit of risk. If you would invest  1,071  in Snap Inc on August 29, 2024 and sell it today you would earn a total of  89.00  from holding Snap Inc or generate 8.31% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthSignificant
Accuracy100.0%
ValuesDaily Returns

Snap Inc  vs.  AB Active ETFs,

 Performance 
       Timeline  
Snap Inc 

Risk-Adjusted Performance

9 of 100

 
Weak
 
Strong
OK
Compared to the overall equity markets, risk-adjusted returns on investments in Snap Inc are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. Even with relatively unfluctuating basic indicators, Snap reported solid returns over the last few months and may actually be approaching a breakup point.
AB Active ETFs, 

Risk-Adjusted Performance

12 of 100

 
Weak
 
Strong
Good
Compared to the overall equity markets, risk-adjusted returns on investments in AB Active ETFs, are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. In spite of rather fragile technical and fundamental indicators, AB Active may actually be approaching a critical reversion point that can send shares even higher in December 2024.

Snap and AB Active Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Snap and AB Active

The main advantage of trading using opposite Snap and AB Active positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Snap position performs unexpectedly, AB Active 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 AB Active will offset losses from the drop in AB Active's long position.
The idea behind Snap Inc and AB Active ETFs, pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
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 Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..

Other Complementary Tools

Latest Portfolios
Quick portfolio dashboard that showcases your latest portfolios
Companies Directory
Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals
Portfolio Volatility
Check portfolio volatility and analyze historical return density to properly model market risk
Equity Forecasting
Use basic forecasting models to generate price predictions and determine price momentum
Performance Analysis
Check effects of mean-variance optimization against your current asset allocation