Correlation Between Abrdn Bloomberg and IShares SP
Can any of the company-specific risk be diversified away by investing in both Abrdn Bloomberg and IShares SP 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 Bloomberg and IShares SP into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between abrdn Bloomberg All and iShares SP GSCI, you can compare the effects of market volatilities on Abrdn Bloomberg and IShares SP 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 Bloomberg with a short position of IShares SP. Check out your portfolio center. Please also check ongoing floating volatility patterns of Abrdn Bloomberg and IShares SP.
Diversification Opportunities for Abrdn Bloomberg and IShares SP
0.94 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Abrdn and IShares is 0.94. Overlapping area represents the amount of risk that can be diversified away by holding abrdn Bloomberg All and iShares SP GSCI in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on iShares SP GSCI and Abrdn Bloomberg 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 Bloomberg All are associated (or correlated) with IShares SP. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of iShares SP GSCI has no effect on the direction of Abrdn Bloomberg i.e., Abrdn Bloomberg and IShares SP go up and down completely randomly.
Pair Corralation between Abrdn Bloomberg and IShares SP
Considering the 90-day investment horizon abrdn Bloomberg All is expected to generate 0.78 times more return on investment than IShares SP. However, abrdn Bloomberg All is 1.28 times less risky than IShares SP. It trades about 0.36 of its potential returns per unit of risk. iShares SP GSCI is currently generating about 0.17 per unit of risk. If you would invest 3,144 in abrdn Bloomberg All on January 24, 2024 and sell it today you would earn a total of 125.00 from holding abrdn Bloomberg All or generate 3.98% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
abrdn Bloomberg All vs. iShares SP GSCI
Performance |
| Timeline |
| abrdn Bloomberg All |
| iShares SP GSCI |
Abrdn Bloomberg and IShares SP Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Abrdn Bloomberg and IShares SP
The main advantage of trading using opposite Abrdn Bloomberg and IShares SP positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Abrdn Bloomberg position performs unexpectedly, IShares SP 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 IShares SP will offset losses from the drop in IShares SP's long position.| Abrdn Bloomberg vs. abrdn Bloomberg All | Abrdn Bloomberg vs. iShares Bloomberg Roll | Abrdn Bloomberg vs. GraniteShares Bloomberg Commodity | Abrdn Bloomberg vs. iShares GSCI Commodity |
| IShares SP vs. Invesco DB Commodity | IShares SP vs. iPath Bloomberg Commodity | IShares SP vs. Invesco DB Base | IShares SP vs. Invesco DB Agriculture |
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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
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