Correlation Between American Beacon and Columbia Mid
Can any of the company-specific risk be diversified away by investing in both American Beacon and Columbia Mid 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 American Beacon and Columbia Mid into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between American Beacon Mid Cap and Columbia Mid Cap, you can compare the effects of market volatilities on American Beacon and Columbia Mid 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 American Beacon with a short position of Columbia Mid. Check out your portfolio center. Please also check ongoing floating volatility patterns of American Beacon and Columbia Mid.
Diversification Opportunities for American Beacon and Columbia Mid
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between American and Columbia is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding American Beacon Mid Cap and Columbia Mid Cap in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Columbia Mid Cap and American Beacon 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 American Beacon Mid Cap are associated (or correlated) with Columbia Mid. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Columbia Mid Cap has no effect on the direction of American Beacon i.e., American Beacon and Columbia Mid go up and down completely randomly.
Pair Corralation between American Beacon and Columbia Mid
If you would invest 1,180 in Columbia Mid Cap on January 26, 2024 and sell it today you would earn a total of 179.00 from holding Columbia Mid Cap or generate 15.17% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 0.0% |
| Values | Daily Returns |
American Beacon Mid Cap vs. Columbia Mid Cap
Performance |
| Timeline |
| American Beacon Mid |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Columbia Mid Cap |
American Beacon and Columbia Mid Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with American Beacon and Columbia Mid
The main advantage of trading using opposite American Beacon and Columbia Mid positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if American Beacon position performs unexpectedly, Columbia Mid 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 Columbia Mid will offset losses from the drop in Columbia Mid's long position.| American Beacon vs. Lord Abbett Diversified | American Beacon vs. Fidelity Advisor Diversified | American Beacon vs. Elfun Diversified Fund | American Beacon vs. Delaware Limited Term Diversified |
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 Portfolio Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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