Correlation Between Saat Defensive and Ab Impact
Can any of the company-specific risk be diversified away by investing in both Saat Defensive and Ab Impact 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 Saat Defensive and Ab Impact into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Saat Defensive Strategy and Ab Impact Municipal, you can compare the effects of market volatilities on Saat Defensive and Ab Impact 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 Saat Defensive with a short position of Ab Impact. Check out your portfolio center. Please also check ongoing floating volatility patterns of Saat Defensive and Ab Impact.
Diversification Opportunities for Saat Defensive and Ab Impact
0.73 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Saat and ABIMX is 0.73. Overlapping area represents the amount of risk that can be diversified away by holding Saat Defensive Strategy and Ab Impact Municipal in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ab Impact Municipal and Saat Defensive 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 Saat Defensive Strategy are associated (or correlated) with Ab Impact. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ab Impact Municipal has no effect on the direction of Saat Defensive i.e., Saat Defensive and Ab Impact go up and down completely randomly.
Pair Corralation between Saat Defensive and Ab Impact
Assuming the 90 days horizon Saat Defensive is expected to generate 1.18 times less return on investment than Ab Impact. But when comparing it to its historical volatility, Saat Defensive Strategy is 2.42 times less risky than Ab Impact. It trades about 0.18 of its potential returns per unit of risk. Ab Impact Municipal is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 901.00 in Ab Impact Municipal on August 31, 2024 and sell it today you would earn a total of 98.00 from holding Ab Impact Municipal or generate 10.88% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Saat Defensive Strategy vs. Ab Impact Municipal
Performance |
| Timeline |
| Saat Defensive Strategy |
| Ab Impact Municipal |
Saat Defensive and Ab Impact Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Saat Defensive and Ab Impact
The main advantage of trading using opposite Saat Defensive and Ab Impact positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Saat Defensive position performs unexpectedly, Ab Impact 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 Impact will offset losses from the drop in Ab Impact's long position.| Saat Defensive vs. Prudential Health Sciences | Saat Defensive vs. Alphacentric Lifesci Healthcare | Saat Defensive vs. Live Oak Health | Saat Defensive vs. Baillie Gifford Health |
| Ab Impact vs. Enhanced Large Pany | Ab Impact vs. Jhancock Disciplined Value | Ab Impact vs. Tax Managed Large Cap | Ab Impact vs. Touchstone Large Cap |
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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
Other Complementary Tools
| Price Ceiling Movement Calculate and plot Price Ceiling Movement for different equity instruments | |
| Commodity Directory Find actively traded commodities issued by global exchanges | |
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
| Odds Of Bankruptcy Get analysis of equity chance of financial distress in the next 2 years | |
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing |