Correlation Between MicroSectors FANG and Abrdn Physical
Can any of the company-specific risk be diversified away by investing in both MicroSectors FANG and Abrdn Physical 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 MicroSectors FANG and Abrdn Physical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between MicroSectors FANG Index and abrdn Physical Gold, you can compare the effects of market volatilities on MicroSectors FANG and Abrdn Physical 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 MicroSectors FANG with a short position of Abrdn Physical. Check out your portfolio center. Please also check ongoing floating volatility patterns of MicroSectors FANG and Abrdn Physical.
Diversification Opportunities for MicroSectors FANG and Abrdn Physical
-0.85 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between MicroSectors and Abrdn is -0.85. Overlapping area represents the amount of risk that can be diversified away by holding MicroSectors FANG Index and abrdn Physical Gold in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on abrdn Physical Gold and MicroSectors FANG 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 MicroSectors FANG Index are associated (or correlated) with Abrdn Physical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of abrdn Physical Gold has no effect on the direction of MicroSectors FANG i.e., MicroSectors FANG and Abrdn Physical go up and down completely randomly.
Pair Corralation between MicroSectors FANG and Abrdn Physical
Given the investment horizon of 90 days MicroSectors FANG Index is expected to under-perform the Abrdn Physical. In addition to that, MicroSectors FANG is 3.46 times more volatile than abrdn Physical Gold. It trades about -0.08 of its total potential returns per unit of risk. abrdn Physical Gold is currently generating about 0.4 per unit of volatility. If you would invest 3,242 in abrdn Physical Gold on July 19, 2025 and sell it today you would earn a total of 864.00 from holding abrdn Physical Gold or generate 26.65% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
MicroSectors FANG Index vs. abrdn Physical Gold
Performance |
| Timeline |
| MicroSectors FANG Index |
| abrdn Physical Gold |
MicroSectors FANG and Abrdn Physical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MicroSectors FANG and Abrdn Physical
The main advantage of trading using opposite MicroSectors FANG and Abrdn Physical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MicroSectors FANG position performs unexpectedly, Abrdn Physical 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 Abrdn Physical will offset losses from the drop in Abrdn Physical's long position.| MicroSectors FANG vs. Direxion Daily Semiconductor | MicroSectors FANG vs. Direxion Daily Technology | MicroSectors FANG vs. Bank of Montreal | MicroSectors FANG vs. Direxion Daily SP |
| Abrdn Physical vs. abrdn Physical Silver | Abrdn Physical vs. GraniteShares Gold Trust | Abrdn Physical vs. SPDR Gold Mini | Abrdn Physical vs. abrdn Physical Platinum |
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 CEOs Directory module to screen CEOs from public companies around the world.
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