Correlation Between Ab Municipal and Arrow Managed
Can any of the company-specific risk be diversified away by investing in both Ab Municipal and Arrow Managed 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 Arrow Managed 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 Arrow Managed Futures, you can compare the effects of market volatilities on Ab Municipal and Arrow Managed 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 Arrow Managed. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ab Municipal and Arrow Managed.
Diversification Opportunities for Ab Municipal and Arrow Managed
0.68 | Correlation Coefficient |
Poor diversification
The 3 months correlation between AUNTX and Arrow is 0.68. Overlapping area represents the amount of risk that can be diversified away by holding Ab Municipal Bond and Arrow Managed Futures in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Arrow Managed Futures 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 Arrow Managed. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Arrow Managed Futures has no effect on the direction of Ab Municipal i.e., Ab Municipal and Arrow Managed go up and down completely randomly.
Pair Corralation between Ab Municipal and Arrow Managed
Assuming the 90 days horizon Ab Municipal is expected to generate 15.44 times less return on investment than Arrow Managed. But when comparing it to its historical volatility, Ab Municipal Bond is 13.42 times less risky than Arrow Managed. It trades about 0.12 of its potential returns per unit of risk. Arrow Managed Futures is currently generating about 0.14 of returns per unit of risk over similar time horizon. If you would invest 512.00 in Arrow Managed Futures on September 9, 2025 and sell it today you would earn a total of 67.00 from holding Arrow Managed Futures or generate 13.09% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ab Municipal Bond vs. Arrow Managed Futures
Performance |
| Timeline |
| Ab Municipal Bond |
| Arrow Managed Futures |
Ab Municipal and Arrow Managed Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ab Municipal and Arrow Managed
The main advantage of trading using opposite Ab Municipal and Arrow Managed positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ab Municipal position performs unexpectedly, Arrow Managed 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 Arrow Managed will offset losses from the drop in Arrow Managed's long position.| Ab Municipal vs. Vanguard Limited Term Tax Exempt | Ab Municipal vs. Vanguard Limited Term Tax Exempt | Ab Municipal vs. Vanguard Short Term Tax Exempt | Ab Municipal vs. Vanguard Short Term Tax Exempt |
| Arrow Managed vs. Nuveen Real Estate | Arrow Managed vs. Pender Real Estate | Arrow Managed vs. Fidelity Real Estate | Arrow Managed vs. Rems Real Estate |
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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
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