Correlation Between Alphacentric Global and Ab Global

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

By analyzing existing cross correlation between Alphacentric Global Innovations and Ab Global Risk, you can compare the effects of market volatilities on Alphacentric Global and Ab 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 Alphacentric Global with a short position of Ab Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of Alphacentric Global and Ab Global.

Diversification Opportunities for Alphacentric Global and Ab Global

0.31

Correlation Coefficient

Alphacentric Global  Ab Global

Weak diversification

The 3 months correlation between Alphacentric and CABIX is 0.31. Overlapping area represents the amount of risk that can be diversified away by holding Alphacentric Global Innovation and Ab Global Risk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ab Global Risk and Alphacentric 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 Alphacentric Global Innovations are associated (or correlated) with Ab Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ab Global Risk has no effect on the direction of Alphacentric Global i.e., Alphacentric Global and Ab Global go up and down completely randomly.

Pair Corralation between Alphacentric Global and Ab Global

Assuming the 90 days horizon Alphacentric Global Innovations is expected to under-perform the Ab Global. In addition to that, Alphacentric Global is 4.4 times more volatile than Ab Global Risk. It trades about -0.14 of its total potential returns per unit of risk. Ab Global Risk is currently generating about 0.03 per unit of volatility. If you would invest  1,510  in Ab Global Risk on December 28, 2024 and sell it today you would earn a total of  14.00  from holding Ab Global Risk or generate 0.93% return on investment over 90 days.

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

Alphacentric Global Innovation  vs.  Ab Global Risk

Alphacentric Global

Risk-Adjusted Performance

Very Weak

Over the last 90 days Alphacentric Global Innovations 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 basic 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.

Ab Global Risk

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Ab Global Risk are ranked lower than 2 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong forward indicators, Ab Global is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Alphacentric Global and Ab Global

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

The idea behind Alphacentric Global Innovations and Ab Global Risk 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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.