Correlation Between Aberdeen Income and Dividend Growth

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

By analyzing existing cross correlation between Aberdeen Income Credit and Dividend Growth Split, you can compare the effects of market volatilities on Aberdeen Income and Dividend Growth 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 Aberdeen Income with a short position of Dividend Growth. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aberdeen Income and Dividend Growth.

Diversification Opportunities for Aberdeen Income and Dividend Growth

0.0

Correlation Coefficient

Aberdeen Income  Dividend Growth

Pay attention - limited upside

The 3 months correlation between Aberdeen and Dividend is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Aberdeen Income Credit and Dividend Growth Split in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dividend Growth Split and Aberdeen Income 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 Aberdeen Income Credit are associated (or correlated) with Dividend Growth. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dividend Growth Split has no effect on the direction of Aberdeen Income i.e., Aberdeen Income and Dividend Growth go up and down completely randomly.

Pair Corralation between Aberdeen Income and Dividend Growth

If you would invest  483.00  in Aberdeen Income Credit on December 2, 2024 and sell it today you would earn a total of  122.00  from holding Aberdeen Income Credit or generate 25.26% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

Aberdeen Income Credit  vs.  Dividend Growth Split

Aberdeen Income Credit

Risk-Adjusted Performance

Very Weak

Over the last 90 days Aberdeen Income Credit has generated negative risk-adjusted returns adding no value to fund investors. Even with relatively invariable fundamental indicators, Aberdeen Income is not utilizing all of its potentials. The latest stock price agitation, may contribute to short-term losses for the retail investors.

Dividend Growth Split

Risk-Adjusted Performance

Very Weak

Over the last 90 days Dividend Growth Split has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, Dividend Growth is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with Aberdeen Income and Dividend Growth

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

The idea behind Aberdeen Income Credit and Dividend Growth Split 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.

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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.