Correlation Between Abrdn Bloomberg and LMLP

Can any of the company-specific risk be diversified away by investing in both Abrdn Bloomberg and LMLP 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 LMLP 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 LMLP, you can compare the effects of market volatilities on Abrdn Bloomberg and LMLP 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 LMLP. Check out your portfolio center. Please also check ongoing floating volatility patterns of Abrdn Bloomberg and LMLP.

Diversification Opportunities for Abrdn Bloomberg and LMLP

0.0

Correlation Coefficient

Abrdn Bloomberg  LMLP

Pay attention - limited upside

The 3 months correlation between Abrdn and LMLP is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding abrdn Bloomberg All and LMLP in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on LMLP 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 LMLP. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of LMLP has no effect on the direction of Abrdn Bloomberg i.e., Abrdn Bloomberg and LMLP go up and down completely randomly.

Pair Corralation between Abrdn Bloomberg and LMLP

If you would invest  3,194  in abrdn Bloomberg All on January 29, 2024 and sell it today you would earn a total of  82.00  from holding abrdn Bloomberg All or generate 2.57% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

abrdn Bloomberg All  vs.  LMLP

abrdn Bloomberg All

Risk-Adjusted Performance

15 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in abrdn Bloomberg All are ranked lower than 15 (%) of all global equities and portfolios over the last 90 days. In spite of rather inconsistent fundamental indicators, Abrdn Bloomberg may actually be approaching a critical reversion point that can send shares even higher in May 2024.

LMLP

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days LMLP has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively invariable essential indicators, LMLP is not utilizing all of its potentials. The current stock price agitation, may contribute to short-term losses for the retail investors.

Pair Trading with Abrdn Bloomberg and LMLP

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

The idea behind abrdn Bloomberg All and LMLP 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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.