Correlation Between Alliancebernstein and Eaton Vance

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

By analyzing existing cross correlation between Alliancebernstein Bond and Eaton Vance Core, you can compare the effects of market volatilities on Alliancebernstein and Eaton Vance 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 Eaton Vance. Check out your portfolio center. Please also check ongoing floating volatility patterns of Alliancebernstein and Eaton Vance.

Diversification Opportunities for Alliancebernstein and Eaton Vance

0.0

Correlation Coefficient

Alliancebernstein  Eaton Vance

Pay attention - limited upside

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

Pair Corralation between Alliancebernstein and Eaton Vance

Assuming the 90 days horizon Alliancebernstein Bond is expected to generate 110.13 times more return on investment than Eaton Vance. However, Alliancebernstein is 110.13 times more volatile than Eaton Vance Core. It trades about 0.08 of its potential returns per unit of risk. Eaton Vance Core is currently generating about 0.05 per unit of risk. If you would invest  409.00  in Alliancebernstein Bond on September 18, 2024 and sell it today you would lose (309.00) from holding Alliancebernstein Bond or give up 75.55% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	50.3%
Values	Daily Returns

Alliancebernstein Bond  vs.  Eaton Vance Core

Alliancebernstein Bond

Risk-Adjusted Performance

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Very Weak

Over the last 90 days Alliancebernstein Bond has generated negative risk-adjusted returns adding no value to fund investors. In spite of fairly strong basic indicators, Alliancebernstein is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Eaton Vance Core

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Eaton Vance Core has generated negative risk-adjusted returns adding no value to fund investors. In spite of fairly strong forward indicators, Eaton Vance is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Alliancebernstein and Eaton Vance

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

The idea behind Alliancebernstein Bond and Eaton Vance Core 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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.