Correlation Between Ab Global and Multi Manager
Can any of the company-specific risk be diversified away by investing in both Ab Global and Multi Manager 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 Multi Manager into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ab Global Risk and Multi Manager Directional Alternative, you can compare the effects of market volatilities on Ab Global and Multi Manager 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 Multi Manager. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ab Global and Multi Manager.
Diversification Opportunities for Ab Global and Multi Manager
0.34 | Correlation Coefficient |
Weak diversification
The 3 months correlation between CABIX and Multi is 0.34. Overlapping area represents the amount of risk that can be diversified away by holding Ab Global Risk and Multi Manager Directional Alte in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Multi Manager Direct 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 Risk are associated (or correlated) with Multi Manager. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Multi Manager Direct has no effect on the direction of Ab Global i.e., Ab Global and Multi Manager go up and down completely randomly.
Pair Corralation between Ab Global and Multi Manager
Assuming the 90 days horizon Ab Global Risk is expected to under-perform the Multi Manager. In addition to that, Ab Global is 1.26 times more volatile than Multi Manager Directional Alternative. It trades about -0.14 of its total potential returns per unit of risk. Multi Manager Directional Alternative is currently generating about -0.01 per unit of volatility. If you would invest 759.00 in Multi Manager Directional Alternative on September 26, 2024 and sell it today you would lose (15.00) from holding Multi Manager Directional Alternative or give up 1.98% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Very Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Ab Global Risk vs. Multi Manager Directional Alte
Performance |
Timeline |
Ab Global Risk |
Multi Manager Direct |
Ab Global and Multi Manager Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Ab Global and Multi Manager
The main advantage of trading using opposite Ab Global and Multi Manager positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ab Global position performs unexpectedly, Multi Manager 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 Multi Manager will offset losses from the drop in Multi Manager's long position.Ab Global vs. Ab Global E | Ab Global vs. Ab Global E | Ab Global vs. Ab Global E | Ab Global vs. Ab Minnesota Portfolio |
Multi Manager vs. 361 Global Longshort | Multi Manager vs. Mirova Global Green | Multi Manager vs. Ab Global Risk | Multi Manager vs. Ab Global Risk |
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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
Other Complementary Tools
Portfolio Comparator Compare the composition, asset allocations and performance of any two portfolios in your account | |
Content Syndication Quickly integrate customizable finance content to your own investment portal | |
Funds Screener Find actively-traded funds from around the world traded on over 30 global exchanges | |
Companies Directory Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals | |
Risk-Return Analysis View associations between returns expected from investment and the risk you assume |