Correlation Between BGF Global and Aberdeen Global

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

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

Diversification Opportunities for BGF Global and Aberdeen Global

0.0

Correlation Coefficient

BGF Global  Aberdeen Global

Pay attention - limited upside

The 3 months correlation between BGF and Aberdeen is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding BGF Global Allocation and Aberdeen Global Asia in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aberdeen Global Asia and BGF 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 BGF Global Allocation are associated (or correlated) with Aberdeen Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aberdeen Global Asia has no effect on the direction of BGF Global i.e., BGF Global and Aberdeen Global go up and down completely randomly.

Pair Corralation between BGF Global and Aberdeen Global

If you would invest (100.00) in Aberdeen Global Asia on October 9, 2024 and sell it today you would earn a total of  100.00  from holding Aberdeen Global Asia or generate -100.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

BGF Global Allocation  vs.  Aberdeen Global Asia

BGF Global Allocation

Risk-Adjusted Performance

10 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in BGF Global Allocation are ranked lower than 10 (%) of all funds and portfolios of funds over the last 90 days. In spite of rather weak technical and fundamental indicators, BGF Global may actually be approaching a critical reversion point that can send shares even higher in February 2025.

Aberdeen Global Asia

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Aberdeen Global Asia has generated negative risk-adjusted returns adding no value to fund investors. Despite somewhat strong fundamental indicators, Aberdeen Global is not utilizing all of its potentials. The latest stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with BGF Global and Aberdeen Global

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

The idea behind BGF Global Allocation and Aberdeen Global Asia 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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.