Correlation Between Invesco Senior and Aberdeen Income
Can any of the company-specific risk be diversified away by investing in both Invesco Senior and Aberdeen Income 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 Invesco Senior and Aberdeen Income into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Invesco Senior Income and Aberdeen Income Credit, you can compare the effects of market volatilities on Invesco Senior and Aberdeen Income 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 Invesco Senior with a short position of Aberdeen Income. Check out your portfolio center. Please also check ongoing floating volatility patterns of Invesco Senior and Aberdeen Income.
Diversification Opportunities for Invesco Senior and Aberdeen Income
-0.87 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Invesco and Aberdeen is -0.87. Overlapping area represents the amount of risk that can be diversified away by holding Invesco Senior Income and Aberdeen Income Credit in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aberdeen Income Credit and Invesco Senior 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 Invesco Senior Income are associated (or correlated) with Aberdeen Income. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aberdeen Income Credit has no effect on the direction of Invesco Senior i.e., Invesco Senior and Aberdeen Income go up and down completely randomly.
Pair Corralation between Invesco Senior and Aberdeen Income
Considering the 90-day investment horizon Invesco Senior Income is expected to generate 1.12 times more return on investment than Aberdeen Income. However, Invesco Senior is 1.12 times more volatile than Aberdeen Income Credit. It trades about 0.08 of its potential returns per unit of risk. Aberdeen Income Credit is currently generating about -0.06 per unit of risk. If you would invest 386.00 in Invesco Senior Income on August 25, 2024 and sell it today you would earn a total of 4.00 from holding Invesco Senior Income or generate 1.04% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Invesco Senior Income vs. Aberdeen Income Credit
Performance |
| Timeline |
| Invesco Senior Income |
| Aberdeen Income Credit |
Invesco Senior and Aberdeen Income Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Invesco Senior and Aberdeen Income
The main advantage of trading using opposite Invesco Senior and Aberdeen Income positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Invesco Senior position performs unexpectedly, Aberdeen Income 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 Income will offset losses from the drop in Aberdeen Income's long position.| Invesco Senior vs. Nuveen Floating Rate | Invesco Senior vs. Blackrock Muni Intermediate | Invesco Senior vs. Eaton Vance Senior | Invesco Senior vs. BlackRock Floating Rate |
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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
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