Correlation Between Ambrus Core and American Beacon
Can any of the company-specific risk be diversified away by investing in both Ambrus Core and American Beacon 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 Ambrus Core and American Beacon into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ambrus Core Bond and American Beacon Stephens, you can compare the effects of market volatilities on Ambrus Core and American Beacon 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 Ambrus Core with a short position of American Beacon. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ambrus Core and American Beacon.
Diversification Opportunities for Ambrus Core and American Beacon
-0.56 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Ambrus and American is -0.56. Overlapping area represents the amount of risk that can be diversified away by holding Ambrus Core Bond and American Beacon Stephens in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on American Beacon Stephens and Ambrus Core 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 Ambrus Core Bond are associated (or correlated) with American Beacon. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of American Beacon Stephens has no effect on the direction of Ambrus Core i.e., Ambrus Core and American Beacon go up and down completely randomly.
Pair Corralation between Ambrus Core and American Beacon
Assuming the 90 days horizon Ambrus Core is expected to generate 20.65 times less return on investment than American Beacon. But when comparing it to its historical volatility, Ambrus Core Bond is 5.55 times less risky than American Beacon. It trades about 0.14 of its potential returns per unit of risk. American Beacon Stephens is currently generating about 0.51 of returns per unit of risk over similar time horizon. If you would invest 3,830 in American Beacon Stephens on September 5, 2024 and sell it today you would earn a total of 415.00 from holding American Beacon Stephens or generate 10.84% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ambrus Core Bond vs. American Beacon Stephens
Performance |
| Timeline |
| Ambrus Core Bond |
| American Beacon Stephens |
Ambrus Core and American Beacon Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ambrus Core and American Beacon
The main advantage of trading using opposite Ambrus Core and American Beacon positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ambrus Core position performs unexpectedly, American Beacon 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 American Beacon will offset losses from the drop in American Beacon's long position.| Ambrus Core vs. Fundamental Large Cap | Ambrus Core vs. Americafirst Large Cap | Ambrus Core vs. Vela Large Cap | Ambrus Core vs. Pace Large Value |
| American Beacon vs. Ambrus Core Bond | American Beacon vs. T Rowe Price | American Beacon vs. Versatile Bond Portfolio | American Beacon vs. Blrc Sgy Mnp |
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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
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