Correlation Between Ab Select and Multi-asset Growth
Can any of the company-specific risk be diversified away by investing in both Ab Select and Multi-asset Growth 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 Select and Multi-asset Growth into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ab Select Longshort and Multi Asset Growth Strategy, you can compare the effects of market volatilities on Ab Select and Multi-asset Growth 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 Select with a short position of Multi-asset Growth. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ab Select and Multi-asset Growth.
Diversification Opportunities for Ab Select and Multi-asset Growth
0.98 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between ASCLX and Multi-asset is 0.98. Overlapping area represents the amount of risk that can be diversified away by holding Ab Select Longshort and Multi Asset Growth Strategy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Multi Asset Growth and Ab Select 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 Select Longshort are associated (or correlated) with Multi-asset Growth. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Multi Asset Growth has no effect on the direction of Ab Select i.e., Ab Select and Multi-asset Growth go up and down completely randomly.
Pair Corralation between Ab Select and Multi-asset Growth
Assuming the 90 days horizon Ab Select is expected to generate 1.34 times less return on investment than Multi-asset Growth. But when comparing it to its historical volatility, Ab Select Longshort is 1.24 times less risky than Multi-asset Growth. It trades about 0.32 of its potential returns per unit of risk. Multi Asset Growth Strategy is currently generating about 0.34 of returns per unit of risk over similar time horizon. If you would invest 1,055 in Multi Asset Growth Strategy on April 24, 2025 and sell it today you would earn a total of 86.00 from holding Multi Asset Growth Strategy or generate 8.15% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Very Strong |
Accuracy | 100.0% |
Values | Daily Returns |
Ab Select Longshort vs. Multi Asset Growth Strategy
Performance |
Timeline |
Ab Select Longshort |
Multi Asset Growth |
Ab Select and Multi-asset Growth Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Ab Select and Multi-asset Growth
The main advantage of trading using opposite Ab Select and Multi-asset Growth positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ab Select position performs unexpectedly, Multi-asset Growth 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-asset Growth will offset losses from the drop in Multi-asset Growth's long position.Ab Select vs. M Large Cap | Ab Select vs. Transamerica Large Cap | Ab Select vs. Aqr Large Cap | Ab Select vs. Vest Large Cap |
Multi-asset Growth vs. Qs Small Capitalization | Multi-asset Growth vs. Goldman Sachs Small | Multi-asset Growth vs. Sp Smallcap 600 | Multi-asset Growth vs. Eagle Small Cap |
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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
Other Complementary Tools
FinTech Suite Use AI to screen and filter profitable investment opportunities | |
Watchlist Optimization Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm | |
Stock Tickers Use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites | |
Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings | |
Price Ceiling Movement Calculate and plot Price Ceiling Movement for different equity instruments |