Correlation Between American Beacon and Vanguard Selected
Can any of the company-specific risk be diversified away by investing in both American Beacon and Vanguard Selected 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 American Beacon and Vanguard Selected into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between American Beacon Mid Cap and Vanguard Selected Value, you can compare the effects of market volatilities on American Beacon and Vanguard Selected 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 American Beacon with a short position of Vanguard Selected. Check out your portfolio center. Please also check ongoing floating volatility patterns of American Beacon and Vanguard Selected.
Diversification Opportunities for American Beacon and Vanguard Selected
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between American and Vanguard is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding American Beacon Mid Cap and Vanguard Selected Value in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Vanguard Selected Value and American Beacon 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 American Beacon Mid Cap are associated (or correlated) with Vanguard Selected. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Vanguard Selected Value has no effect on the direction of American Beacon i.e., American Beacon and Vanguard Selected go up and down completely randomly.
Pair Corralation between American Beacon and Vanguard Selected
If you would invest (100.00) in American Beacon Mid Cap on January 26, 2024 and sell it today you would earn a total of 100.00 from holding American Beacon Mid Cap 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 |
American Beacon Mid Cap vs. Vanguard Selected Value
Performance |
| Timeline |
| American Beacon Mid |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Vanguard Selected Value |
American Beacon and Vanguard Selected Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with American Beacon and Vanguard Selected
The main advantage of trading using opposite American Beacon and Vanguard Selected positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if American Beacon position performs unexpectedly, Vanguard Selected 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 Vanguard Selected will offset losses from the drop in Vanguard Selected's long position.| American Beacon vs. Commonwealth Global Fund | American Beacon vs. 361 Global Longshort | American Beacon vs. Legg Mason Global | American Beacon vs. Dreyfusstandish Global Fixed |
| Vanguard Selected vs. Vanguard Capital Opportunity | Vanguard Selected vs. Vanguard Primecap E | Vanguard Selected vs. Vanguard Dividend Growth | Vanguard Selected vs. Vanguard Strategic Equity |
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 Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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