Correlation Between United States and AllianceBernstein
Can any of the company-specific risk be diversified away by investing in both United States and AllianceBernstein 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 United States and AllianceBernstein into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between United States Gasoline and AllianceBernstein Holding LP, you can compare the effects of market volatilities on United States and AllianceBernstein 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 United States with a short position of AllianceBernstein. Check out your portfolio center. Please also check ongoing floating volatility patterns of United States and AllianceBernstein.
Diversification Opportunities for United States and AllianceBernstein
0.51 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between United and AllianceBernstein is 0.51. Overlapping area represents the amount of risk that can be diversified away by holding United States Gasoline and AllianceBernstein Holding LP in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AllianceBernstein and United States 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 United States Gasoline are associated (or correlated) with AllianceBernstein. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AllianceBernstein has no effect on the direction of United States i.e., United States and AllianceBernstein go up and down completely randomly.
Pair Corralation between United States and AllianceBernstein
Considering the 90-day investment horizon United States Gasoline is expected to generate 1.13 times more return on investment than AllianceBernstein. However, United States is 1.13 times more volatile than AllianceBernstein Holding LP. It trades about 0.04 of its potential returns per unit of risk. AllianceBernstein Holding LP is currently generating about 0.0 per unit of risk. If you would invest 5,875 in United States Gasoline on January 24, 2024 and sell it today you would earn a total of 1,185 from holding United States Gasoline or generate 20.17% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
United States Gasoline vs. AllianceBernstein Holding LP
Performance |
| Timeline |
| United States Gasoline |
| AllianceBernstein |
United States and AllianceBernstein Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with United States and AllianceBernstein
The main advantage of trading using opposite United States and AllianceBernstein positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if United States position performs unexpectedly, AllianceBernstein 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 AllianceBernstein will offset losses from the drop in AllianceBernstein's long position.| United States vs. United States 12 | United States vs. Invesco DB Energy | United States vs. United States Brent | United States vs. Invesco DB Oil |
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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 Commodity Directory module to find actively traded commodities issued by global exchanges.
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