Correlation Between Nationwide Investor and American Beacon
Can any of the company-specific risk be diversified away by investing in both Nationwide Investor and American Beacon 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 Nationwide Investor and American Beacon into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Nationwide Investor Destinations and American Beacon International, you can compare the effects of market volatilities on Nationwide Investor and American Beacon 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 Nationwide Investor with a short position of American Beacon. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nationwide Investor and American Beacon.
Diversification Opportunities for Nationwide Investor and American Beacon
0.69 | Correlation Coefficient |
Poor diversification
The 3 months correlation between NATIONWIDE and American is 0.69. Overlapping area represents the amount of risk that can be diversified away by holding Nationwide Investor Destinatio and American Beacon International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on American Beacon Inte and Nationwide Investor 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 Nationwide Investor Destinations are associated (or correlated) with American Beacon. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of American Beacon Inte has no effect on the direction of Nationwide Investor i.e., Nationwide Investor and American Beacon go up and down completely randomly.
Pair Corralation between Nationwide Investor and American Beacon
Assuming the 90 days horizon Nationwide Investor is expected to generate 1.3 times less return on investment than American Beacon. But when comparing it to its historical volatility, Nationwide Investor Destinations is 2.36 times less risky than American Beacon. It trades about 0.13 of its potential returns per unit of risk. American Beacon International is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 1,767 in American Beacon International on August 28, 2025 and sell it today you would earn a total of 59.00 from holding American Beacon International or generate 3.34% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 98.44% |
| Values | Daily Returns |
Nationwide Investor Destinatio vs. American Beacon International
Performance |
| Timeline |
| Nationwide Investor |
| American Beacon Inte |
Risk-Adjusted Performance
Soft
Weak | Strong |
Nationwide Investor and American Beacon Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nationwide Investor and American Beacon
The main advantage of trading using opposite Nationwide Investor and American Beacon positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nationwide Investor position performs unexpectedly, American Beacon 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 American Beacon will offset losses from the drop in American Beacon's long position.| Nationwide Investor vs. Rbc Bluebay Global | Nationwide Investor vs. Ab Global Risk | Nationwide Investor vs. Siit Global Managed | Nationwide Investor vs. Ab Global Bond |
| American Beacon vs. Pro Blend Servative Term | American Beacon vs. Dreyfusstandish Global Fixed | American Beacon vs. Ultra Short Fixed Income | American Beacon vs. Sei Insti Mgd |
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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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