Correlation Between Crawford Multi-asset and Ab Small

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

By analyzing existing cross correlation between Crawford Multi Asset Income and Ab Small Cap, you can compare the effects of market volatilities on Crawford Multi-asset and Ab Small 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 Crawford Multi-asset with a short position of Ab Small. Check out your portfolio center. Please also check ongoing floating volatility patterns of Crawford Multi-asset and Ab Small.

Diversification Opportunities for Crawford Multi-asset and Ab Small

-0.24

Correlation Coefficient

Crawford Multi-asset  Ab Small

Very good diversification

The 3 months correlation between Crawford and SCYVX is -0.24. Overlapping area represents the amount of risk that can be diversified away by holding Crawford Multi Asset Income and Ab Small Cap in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ab Small Cap and Crawford Multi-asset 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 Crawford Multi Asset Income are associated (or correlated) with Ab Small. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ab Small Cap has no effect on the direction of Crawford Multi-asset i.e., Crawford Multi-asset and Ab Small go up and down completely randomly.

Pair Corralation between Crawford Multi-asset and Ab Small

Assuming the 90 days horizon Crawford Multi Asset Income is expected to generate 0.43 times more return on investment than Ab Small. However, Crawford Multi Asset Income is 2.32 times less risky than Ab Small. It trades about 0.15 of its potential returns per unit of risk. Ab Small Cap is currently generating about -0.12 per unit of risk. If you would invest  2,622  in Crawford Multi Asset Income on December 21, 2024 and sell it today you would earn a total of  113.00  from holding Crawford Multi Asset Income or generate 4.31% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Crawford Multi Asset Income  vs.  Ab Small Cap

Crawford Multi Asset

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Crawford Multi Asset Income are ranked lower than 11 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong essential indicators, Crawford Multi-asset is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Ab Small Cap

Risk-Adjusted Performance

Very Weak

Over the last 90 days Ab Small Cap has generated negative risk-adjusted returns adding no value to fund investors. In spite of latest weak performance, the Fund's basic indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the fund investors.

Pair Trading with Crawford Multi-asset and Ab Small

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

The idea behind Crawford Multi Asset Income and Ab 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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.