Correlation Between Ab Municipal and Ab Core
Can any of the company-specific risk be diversified away by investing in both Ab Municipal 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 Ab Municipal and Ab Core into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ab Municipal Bond and Ab E Opportunities, you can compare the effects of market volatilities on Ab Municipal 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 Ab Municipal with a short position of Ab Core. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ab Municipal and Ab Core.
Diversification Opportunities for Ab Municipal and Ab Core
0.93 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between AUNTX and ADGAX is 0.93. Overlapping area represents the amount of risk that can be diversified away by holding Ab Municipal Bond 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 Ab Municipal 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 Municipal Bond 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 Ab Municipal i.e., Ab Municipal and Ab Core go up and down completely randomly.
Pair Corralation between Ab Municipal and Ab Core
Assuming the 90 days horizon Ab Municipal is expected to generate 3.0 times less return on investment than Ab Core. But when comparing it to its historical volatility, Ab Municipal Bond is 5.42 times less risky than Ab Core. It trades about 0.33 of its potential returns per unit of risk. Ab E Opportunities is currently generating about 0.18 of returns per unit of risk over similar time horizon. If you would invest 2,378 in Ab E Opportunities on June 6, 2025 and sell it today you would earn a total of 176.00 from holding Ab E Opportunities or generate 7.4% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 98.39% |
| Values | Daily Returns |
Ab Municipal Bond vs. Ab E Opportunities
Performance |
| Timeline |
| Ab Municipal Bond |
| Ab E Opportunities |
Ab Municipal and Ab Core Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ab Municipal and Ab Core
The main advantage of trading using opposite Ab Municipal and Ab Core positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ab Municipal 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.| Ab Municipal vs. Artisan High Income | Ab Municipal vs. Ab Bond Inflation | Ab Municipal vs. Ambrus Core Bond | Ab Municipal vs. Multisector Bond Sma |
| Ab Core vs. Vanguard Global Equity | Ab Core vs. The Gabelli Global | Ab Core vs. Morningstar Global Income | Ab Core vs. Qs Global 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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
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