Correlation Between Abrdn ETFs and Invesco Electric

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

By analyzing existing cross correlation between abrdn ETFs and Invesco Electric Vehicle, you can compare the effects of market volatilities on Abrdn ETFs and Invesco Electric 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 Abrdn ETFs with a short position of Invesco Electric. Check out your portfolio center. Please also check ongoing floating volatility patterns of Abrdn ETFs and Invesco Electric.

Diversification Opportunities for Abrdn ETFs and Invesco Electric

0.93

Correlation Coefficient

Abrdn ETFs  Invesco Electric

Almost no diversification

The 3 months correlation between Abrdn and Invesco is 0.93. Overlapping area represents the amount of risk that can be diversified away by holding abrdn ETFs and Invesco Electric Vehicle in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Invesco Electric Vehicle and Abrdn ETFs 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 abrdn ETFs are associated (or correlated) with Invesco Electric. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Invesco Electric Vehicle has no effect on the direction of Abrdn ETFs i.e., Abrdn ETFs and Invesco Electric go up and down completely randomly.

Pair Corralation between Abrdn ETFs and Invesco Electric

Given the investment horizon of 90 days abrdn ETFs is expected to generate 0.93 times more return on investment than Invesco Electric. However, abrdn ETFs is 1.07 times less risky than Invesco Electric. It trades about 0.0 of its potential returns per unit of risk. Invesco Electric Vehicle is currently generating about -0.06 per unit of risk. If you would invest  2,391  in abrdn ETFs on September 13, 2024 and sell it today you would lose (81.00) from holding abrdn ETFs or give up 3.39% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Strong
Accuracy	100.0%
Values	Daily Returns

abrdn ETFs   vs.  Invesco Electric Vehicle

abrdn ETFs

Risk-Adjusted Performance

2 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in abrdn ETFs are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of very healthy forward indicators, Abrdn ETFs is not utilizing all of its potentials. The latest stock price disarray, may contribute to short-term losses for the investors.

Invesco Electric Vehicle

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Invesco Electric Vehicle are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively stable primary indicators, Invesco Electric is not utilizing all of its potentials. The recent stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with Abrdn ETFs and Invesco Electric

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

The idea behind abrdn ETFs and Invesco Electric Vehicle 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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.