Correlation Between Absolute Capital and Absolute Cef

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

By analyzing existing cross correlation between Absolute Capital Opportunities and Absolute Cef Opportunities, you can compare the effects of market volatilities on Absolute Capital and Absolute Cef 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 Absolute Capital with a short position of Absolute Cef. Check out your portfolio center. Please also check ongoing floating volatility patterns of Absolute Capital and Absolute Cef.

Diversification Opportunities for Absolute Capital and Absolute Cef

0.59

Correlation Coefficient

Absolute Capital  Absolute Cef

Very weak diversification

The 3 months correlation between Absolute and Absolute is 0.59. Overlapping area represents the amount of risk that can be diversified away by holding Absolute Capital Opportunities and Absolute Cef Opportunities in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Absolute Cef Opportu and Absolute Capital 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 Absolute Capital Opportunities are associated (or correlated) with Absolute Cef. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Absolute Cef Opportu has no effect on the direction of Absolute Capital i.e., Absolute Capital and Absolute Cef go up and down completely randomly.

Pair Corralation between Absolute Capital and Absolute Cef

Assuming the 90 days horizon Absolute Capital is expected to generate 37.76 times less return on investment than Absolute Cef. In addition to that, Absolute Capital is 1.3 times more volatile than Absolute Cef Opportunities. It trades about 0.01 of its total potential returns per unit of risk. Absolute Cef Opportunities is currently generating about 0.3 per unit of volatility. If you would invest  588.00  in Absolute Cef Opportunities on May 17, 2025 and sell it today you would earn a total of  29.00  from holding Absolute Cef Opportunities or generate 4.93% return on investment over 90 days.

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

Absolute Capital Opportunities  vs.  Absolute Cef Opportunities

Absolute Capital Opp

Risk-Adjusted Performance

Weakest

Over the last 90 days Absolute Capital Opportunities has generated negative risk-adjusted returns adding no value to fund investors. In spite of fairly strong basic indicators, Absolute Capital is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Absolute Cef Opportu

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Absolute Cef Opportunities are ranked lower than 23 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong technical and fundamental indicators, Absolute Cef is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Absolute Capital and Absolute Cef

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

The idea behind Absolute Capital Opportunities and Absolute Cef Opportunities 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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.