Correlation Between Ab Global and Nationwide Global
Can any of the company-specific risk be diversified away by investing in both Ab Global and Nationwide 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 Ab Global and Nationwide Global into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ab Global Bond and Nationwide Global Equity, you can compare the effects of market volatilities on Ab Global and Nationwide 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 Ab Global with a short position of Nationwide Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ab Global and Nationwide Global.
Diversification Opportunities for Ab Global and Nationwide Global
0.54 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between ANAGX and Nationwide is 0.54. Overlapping area represents the amount of risk that can be diversified away by holding Ab Global Bond and Nationwide Global Equity in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nationwide Global Equity and Ab Global 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 Ab Global Bond are associated (or correlated) with Nationwide Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nationwide Global Equity has no effect on the direction of Ab Global i.e., Ab Global and Nationwide Global go up and down completely randomly.
Pair Corralation between Ab Global and Nationwide Global
Assuming the 90 days horizon Ab Global is expected to generate 1.19 times less return on investment than Nationwide Global. But when comparing it to its historical volatility, Ab Global Bond is 3.67 times less risky than Nationwide Global. It trades about 0.07 of its potential returns per unit of risk. Nationwide Global Equity is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 2,012 in Nationwide Global Equity on October 5, 2024 and sell it today you would earn a total of 87.00 from holding Nationwide Global Equity or generate 4.32% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Ab Global Bond vs. Nationwide Global Equity
Performance |
Timeline |
Ab Global Bond |
Nationwide Global Equity |
Ab Global and Nationwide Global Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Ab Global and Nationwide Global
The main advantage of trading using opposite Ab Global and Nationwide Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ab Global position performs unexpectedly, Nationwide 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 Nationwide Global will offset losses from the drop in Nationwide Global's long position.Ab Global vs. Firsthand Alternative Energy | Ab Global vs. World Energy Fund | Ab Global vs. Pimco Energy Tactical | Ab Global vs. Blackrock All Cap Energy |
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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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
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