Correlation Between Alliancebernstein and Active M

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

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

Diversification Opportunities for Alliancebernstein and Active M

0.0

Correlation Coefficient

Alliancebernstein  Active M

Pay attention - limited upside

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

Pair Corralation between Alliancebernstein and Active M

If you would invest  1,069  in Active M International on December 25, 2024 and sell it today you would earn a total of  114.00  from holding Active M International or generate 10.66% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	96.77%
Values	Daily Returns

Alliancebernstein Bond  vs.  Active M International

Alliancebernstein Bond

Risk-Adjusted Performance

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.

Active M International

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Active M International are ranked lower than 14 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak technical and fundamental indicators, Active M may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Pair Trading with Alliancebernstein and Active M

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

The idea behind Alliancebernstein Bond and Active M International 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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.