Correlation Between AllianceBernstein and Evercore Partners

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

By analyzing existing cross correlation between AllianceBernstein Holding LP and Evercore Partners, you can compare the effects of market volatilities on AllianceBernstein and Evercore Partners 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 Evercore Partners. Check out your portfolio center. Please also check ongoing floating volatility patterns of AllianceBernstein and Evercore Partners.

Diversification Opportunities for AllianceBernstein and Evercore Partners

0.66

Correlation Coefficient

AllianceBernstein  Evercore Partners

Poor diversification

The 3 months correlation between AllianceBernstein and Evercore is 0.66. Overlapping area represents the amount of risk that can be diversified away by holding AllianceBernstein Holding LP and Evercore Partners in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Evercore Partners 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 Holding LP are associated (or correlated) with Evercore Partners. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Evercore Partners has no effect on the direction of AllianceBernstein i.e., AllianceBernstein and Evercore Partners go up and down completely randomly.

Pair Corralation between AllianceBernstein and Evercore Partners

Allowing for the 90-day total investment horizon AllianceBernstein Holding LP is expected to under-perform the Evercore Partners. But the stock apears to be less risky and, when comparing its historical volatility, AllianceBernstein Holding LP is 1.21 times less risky than Evercore Partners. The stock trades about -0.05 of its potential returns per unit of risk. The Evercore Partners is currently generating about 0.0 of returns per unit of risk over similar time horizon. If you would invest  19,355  in Evercore Partners on February 8, 2024 and sell it today you would lose (45.00) from holding Evercore Partners or give up 0.23% of portfolio value over 90 days.

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

AllianceBernstein Holding LP  vs.  Evercore Partners

AllianceBernstein

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in AllianceBernstein Holding LP are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite somewhat strong fundamental drivers, AllianceBernstein is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Evercore Partners

Risk-Adjusted Performance

8 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Evercore Partners are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. Even with relatively uncertain basic indicators, Evercore Partners may actually be approaching a critical reversion point that can send shares even higher in June 2024.

Pair Trading with AllianceBernstein and Evercore Partners

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

The idea behind AllianceBernstein Holding LP and Evercore Partners 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.

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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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.