Correlation Between Ab High and Cref Inflation
Can any of the company-specific risk be diversified away by investing in both Ab High and Cref Inflation 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 High and Cref Inflation into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ab High Income and Cref Inflation Linked Bond, you can compare the effects of market volatilities on Ab High and Cref Inflation 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 High with a short position of Cref Inflation. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ab High and Cref Inflation.
Diversification Opportunities for Ab High and Cref Inflation
0.77 | Correlation Coefficient |
Poor diversification
The 3 months correlation between AGDAX and Cref is 0.77. Overlapping area represents the amount of risk that can be diversified away by holding Ab High Income and Cref Inflation Linked Bond in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cref Inflation Linked and Ab High 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 High Income are associated (or correlated) with Cref Inflation. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cref Inflation Linked has no effect on the direction of Ab High i.e., Ab High and Cref Inflation go up and down completely randomly.
Pair Corralation between Ab High and Cref Inflation
Assuming the 90 days horizon Ab High Income is expected to generate 0.97 times more return on investment than Cref Inflation. However, Ab High Income is 1.03 times less risky than Cref Inflation. It trades about 0.38 of its potential returns per unit of risk. Cref Inflation Linked Bond is currently generating about 0.16 per unit of risk. If you would invest 673.00 in Ab High Income on April 22, 2025 and sell it today you would earn a total of 31.00 from holding Ab High Income or generate 4.61% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ab High Income vs. Cref Inflation Linked Bond
Performance |
| Timeline |
| Ab High Income |
| Cref Inflation Linked |
Ab High and Cref Inflation Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ab High and Cref Inflation
The main advantage of trading using opposite Ab High and Cref Inflation positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ab High position performs unexpectedly, Cref Inflation 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 Cref Inflation will offset losses from the drop in Cref Inflation's long position.| Ab High vs. Growth Allocation Fund | Ab High vs. Enhanced Large Pany | Ab High vs. Nuveen Large Cap | Ab High vs. Gmo Equity Allocation |
| Cref Inflation vs. Aig Government Money | Cref Inflation vs. Franklin Government Securities | Cref Inflation vs. Alpine Ultra Short | Cref Inflation vs. Ab Municipal Bond |
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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
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