Correlation Between Alliancebernstein and Simt Multi

Can any of the company-specific risk be diversified away by investing in both Alliancebernstein and Simt Multi 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 Alliancebernstein and Simt Multi into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Alliancebernstein Global High and Simt Multi Asset Capital, you can compare the effects of market volatilities on Alliancebernstein and Simt Multi 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 Alliancebernstein with a short position of Simt Multi. Check out your portfolio center. Please also check ongoing floating volatility patterns of Alliancebernstein and Simt Multi.

Diversification Opportunities for Alliancebernstein and Simt Multi

0.74

Correlation Coefficient

Alliancebernstein  Simt Multi

Poor diversification

The 3 months correlation between Alliancebernstein and Simt is 0.74. Overlapping area represents the amount of risk that can be diversified away by holding Alliancebernstein Global High and Simt Multi Asset Capital in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Simt Multi Asset and Alliancebernstein 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 Alliancebernstein Global High are associated (or correlated) with Simt Multi. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Simt Multi Asset has no effect on the direction of Alliancebernstein i.e., Alliancebernstein and Simt Multi go up and down completely randomly.

Pair Corralation between Alliancebernstein and Simt Multi

Considering the 90-day investment horizon Alliancebernstein Global High is expected to under-perform the Simt Multi. In addition to that, Alliancebernstein is 2.86 times more volatile than Simt Multi Asset Capital. It trades about -0.04 of its total potential returns per unit of risk. Simt Multi Asset Capital is currently generating about 0.03 per unit of volatility. If you would invest  1,054  in Simt Multi Asset Capital on September 18, 2024 and sell it today you would earn a total of  3.00  from holding Simt Multi Asset Capital or generate 0.28% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	98.44%
Values	Daily Returns

Alliancebernstein Global High  vs.  Simt Multi Asset Capital

Alliancebernstein

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Alliancebernstein Global High has generated negative risk-adjusted returns adding no value to fund investors. Despite nearly stable basic indicators, Alliancebernstein is not utilizing all of its potentials. The recent stock price disturbance, may contribute to mid-run losses for the stockholders.

Simt Multi Asset

Risk-Adjusted Performance

2 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Simt Multi Asset Capital are ranked lower than 2 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong basic indicators, Simt Multi is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Alliancebernstein and Simt Multi

The main advantage of trading using opposite Alliancebernstein and Simt Multi positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Alliancebernstein position performs unexpectedly, Simt Multi 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 Simt Multi will offset losses from the drop in Simt Multi's long position.

The idea behind Alliancebernstein Global High and Simt Multi Asset Capital pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.