Correlation Between International Growth and Aberdeen Select
Can any of the company-specific risk be diversified away by investing in both International Growth and Aberdeen Select 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 International Growth and Aberdeen Select into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between International Growth Fund and Aberdeen Select International, you can compare the effects of market volatilities on International Growth and Aberdeen Select 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 International Growth with a short position of Aberdeen Select. Check out your portfolio center. Please also check ongoing floating volatility patterns of International Growth and Aberdeen Select.
Diversification Opportunities for International Growth and Aberdeen Select
0.81 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between International and Aberdeen is 0.81. Overlapping area represents the amount of risk that can be diversified away by holding International Growth Fund and Aberdeen Select International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aberdeen Select Inte and International Growth 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 International Growth Fund are associated (or correlated) with Aberdeen Select. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aberdeen Select Inte has no effect on the direction of International Growth i.e., International Growth and Aberdeen Select go up and down completely randomly.
Pair Corralation between International Growth and Aberdeen Select
Assuming the 90 days horizon International Growth Fund is expected to under-perform the Aberdeen Select. In addition to that, International Growth is 1.16 times more volatile than Aberdeen Select International. It trades about -0.15 of its total potential returns per unit of risk. Aberdeen Select International is currently generating about -0.13 per unit of volatility. If you would invest 1,535 in Aberdeen Select International on August 28, 2024 and sell it today you would lose (31.00) from holding Aberdeen Select International or give up 2.02% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
International Growth Fund vs. Aberdeen Select International
Performance |
| Timeline |
| International Growth |
| Aberdeen Select Inte |
International Growth and Aberdeen Select Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with International Growth and Aberdeen Select
The main advantage of trading using opposite International Growth and Aberdeen Select positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if International Growth position performs unexpectedly, Aberdeen Select 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 Aberdeen Select will offset losses from the drop in Aberdeen Select's long position.| International Growth vs. Value Fund Investor | International Growth vs. Ultra Fund Investor | International Growth vs. Growth Fund Investor | International Growth vs. Select Fund Investor |
| Aberdeen Select vs. Marsico 21st Century | Aberdeen Select vs. Harbor International Fund | Aberdeen Select vs. Loomis Sayles Bond | Aberdeen Select vs. Northern Small 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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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