Correlation Between The Tocqueville and Ab Core

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

By analyzing existing cross correlation between The Tocqueville Fund and Ab E Opportunities, you can compare the effects of market volatilities on The Tocqueville and Ab Core 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 The Tocqueville with a short position of Ab Core. Check out your portfolio center. Please also check ongoing floating volatility patterns of The Tocqueville and Ab Core.

Diversification Opportunities for The Tocqueville and Ab Core

0.98

Correlation Coefficient

The Tocqueville  Ab Core

Almost no diversification

The 3 months correlation between The and ADGAX is 0.98. Overlapping area represents the amount of risk that can be diversified away by holding The Tocqueville Fund and Ab E Opportunities in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ab E Opportunities and The Tocqueville 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 The Tocqueville Fund are associated (or correlated) with Ab Core. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ab E Opportunities has no effect on the direction of The Tocqueville i.e., The Tocqueville and Ab Core go up and down completely randomly.

Pair Corralation between The Tocqueville and Ab Core

Assuming the 90 days horizon The Tocqueville Fund is expected to generate 0.99 times more return on investment than Ab Core. However, The Tocqueville Fund is 1.02 times less risky than Ab Core. It trades about 0.43 of its potential returns per unit of risk. Ab E Opportunities is currently generating about 0.4 per unit of risk. If you would invest  4,146  in The Tocqueville Fund on April 20, 2025 and sell it today you would earn a total of  1,010  from holding The Tocqueville Fund or generate 24.36% return on investment over 90 days.

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

The Tocqueville Fund  vs.  Ab E Opportunities

The Tocqueville

Risk-Adjusted Performance

Very Strong

Compared to the overall equity markets, risk-adjusted returns on investments in The Tocqueville Fund are ranked lower than 33 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak basic indicators, The Tocqueville showed solid returns over the last few months and may actually be approaching a breakup point.

Ab E Opportunities

Risk-Adjusted Performance

Very Strong

Compared to the overall equity markets, risk-adjusted returns on investments in Ab E Opportunities are ranked lower than 31 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak basic indicators, Ab Core showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with The Tocqueville and Ab Core

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

The idea behind The Tocqueville Fund and Ab E 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 Bonds Directory module to find actively traded corporate debentures issued by US companies.