Correlation Between Ab International and Fisher Investments

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

By analyzing existing cross correlation between Ab International Growth and Fisher Small Cap, you can compare the effects of market volatilities on Ab International and Fisher Investments 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 International with a short position of Fisher Investments. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ab International and Fisher Investments.

Diversification Opportunities for Ab International and Fisher Investments

0.27

Correlation Coefficient

Ab International  Fisher Investments

Modest diversification

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

Pair Corralation between Ab International and Fisher Investments

Assuming the 90 days horizon Ab International Growth is expected to generate 0.74 times more return on investment than Fisher Investments. However, Ab International Growth is 1.35 times less risky than Fisher Investments. It trades about 0.01 of its potential returns per unit of risk. Fisher Small Cap is currently generating about -0.18 per unit of risk. If you would invest  1,961  in Ab International Growth on December 29, 2024 and sell it today you would earn a total of  9.00  from holding Ab International Growth or generate 0.46% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	100.0%
Values	Daily Returns

Ab International Growth  vs.  Fisher Small Cap

Ab International Growth

Risk-Adjusted Performance

Very Weak

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

Fisher Investments

Risk-Adjusted Performance

Very Weak

Over the last 90 days Fisher Small Cap has generated negative risk-adjusted returns adding no value to fund investors. In spite of weak performance in the last few months, the Fund's fundamental 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 fund investors.

Pair Trading with Ab International and Fisher Investments

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

The idea behind Ab International Growth and Fisher Small Cap 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 Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.