Correlation Between Westcore Plus and Aberdeen Global
Can any of the company-specific risk be diversified away by investing in both Westcore Plus and Aberdeen Global 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 Westcore Plus and Aberdeen Global into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Westcore Plus Bond and Aberdeen Global High, you can compare the effects of market volatilities on Westcore Plus and Aberdeen Global 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 Westcore Plus with a short position of Aberdeen Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of Westcore Plus and Aberdeen Global.
Diversification Opportunities for Westcore Plus and Aberdeen Global
-0.35 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Westcore and Aberdeen is -0.35. Overlapping area represents the amount of risk that can be diversified away by holding Westcore Plus Bond and Aberdeen Global High in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aberdeen Global High and Westcore Plus 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 Westcore Plus Bond are associated (or correlated) with Aberdeen Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aberdeen Global High has no effect on the direction of Westcore Plus i.e., Westcore Plus and Aberdeen Global go up and down completely randomly.
Pair Corralation between Westcore Plus and Aberdeen Global
Assuming the 90 days horizon Westcore Plus is expected to generate 2.9 times less return on investment than Aberdeen Global. In addition to that, Westcore Plus is 1.69 times more volatile than Aberdeen Global High. It trades about 0.04 of its total potential returns per unit of risk. Aberdeen Global High is currently generating about 0.18 per unit of volatility. If you would invest 669.00 in Aberdeen Global High on August 26, 2024 and sell it today you would earn a total of 111.00 from holding Aberdeen Global High or generate 16.59% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Westcore Plus Bond vs. Aberdeen Global High
Performance |
| Timeline |
| Westcore Plus Bond |
| Aberdeen Global High |
Westcore Plus and Aberdeen Global Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Westcore Plus and Aberdeen Global
The main advantage of trading using opposite Westcore Plus and Aberdeen Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Westcore Plus position performs unexpectedly, Aberdeen Global 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 Global will offset losses from the drop in Aberdeen Global's long position.| Westcore Plus vs. Large Cap Fund | Westcore Plus vs. James Balanced Golden | Westcore Plus vs. Aberdeen Global High | Westcore Plus vs. Loomis Sayles Bond |
| Aberdeen Global vs. Metropolitan West High | Aberdeen Global vs. Westcore Plus Bond | Aberdeen Global vs. Loomis Sayles Bond | Aberdeen Global vs. Equity Series Class |
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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
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