Correlation Between AllianceBernstein and Mars Acquisition

Can any of the company-specific risk be diversified away by investing in both AllianceBernstein and Mars Acquisition 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 AllianceBernstein and Mars Acquisition into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between AllianceBernstein Holding LP and Mars Acquisition Corp, you can compare the effects of market volatilities on AllianceBernstein and Mars Acquisition 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 AllianceBernstein with a short position of Mars Acquisition. Check out your portfolio center. Please also check ongoing floating volatility patterns of AllianceBernstein and Mars Acquisition.

Diversification Opportunities for AllianceBernstein and Mars Acquisition

-0.27

Correlation Coefficient

AllianceBernstein  Mars Acquisition

Very good diversification

The 3 months correlation between AllianceBernstein and Mars is -0.27. Overlapping area represents the amount of risk that can be diversified away by holding AllianceBernstein Holding LP and Mars Acquisition Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mars Acquisition Corp and AllianceBernstein 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 AllianceBernstein Holding LP are associated (or correlated) with Mars Acquisition. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mars Acquisition Corp has no effect on the direction of AllianceBernstein i.e., AllianceBernstein and Mars Acquisition go up and down completely randomly.

Pair Corralation between AllianceBernstein and Mars Acquisition

Allowing for the 90-day total investment horizon AllianceBernstein Holding LP is expected to generate 0.07 times more return on investment than Mars Acquisition. However, AllianceBernstein Holding LP is 14.89 times less risky than Mars Acquisition. It trades about 0.07 of its potential returns per unit of risk. Mars Acquisition Corp is currently generating about -0.54 per unit of risk. If you would invest  3,543  in AllianceBernstein Holding LP on December 28, 2024 and sell it today you would earn a total of  294.00  from holding AllianceBernstein Holding LP or generate 8.3% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	8.2%
Values	Daily Returns

AllianceBernstein Holding LP  vs.  Mars Acquisition Corp

AllianceBernstein

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in AllianceBernstein Holding LP are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. Despite somewhat abnormal fundamental drivers, AllianceBernstein may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Mars Acquisition Corp

Risk-Adjusted Performance

Very Weak

Over the last 90 days Mars Acquisition Corp has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of uncertain performance in the last few months, the Stock's basic indicators remain fairly strong which may send shares a bit higher in April 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

Pair Trading with AllianceBernstein and Mars Acquisition

The main advantage of trading using opposite AllianceBernstein and Mars Acquisition positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AllianceBernstein position performs unexpectedly, Mars Acquisition 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 Mars Acquisition will offset losses from the drop in Mars Acquisition's long position.

The idea behind AllianceBernstein Holding LP and Mars Acquisition Corp pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Bonds Directory module to find actively traded corporate debentures issued by US companies.