Correlation Between Aberforth Smaller and Kaufman Et

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

By analyzing existing cross correlation between Aberforth Smaller Companies and Kaufman Et Broad, you can compare the effects of market volatilities on Aberforth Smaller and Kaufman Et 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 Aberforth Smaller with a short position of Kaufman Et. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aberforth Smaller and Kaufman Et.

Diversification Opportunities for Aberforth Smaller and Kaufman Et

0.3

Correlation Coefficient

Aberforth Smaller  Kaufman Et

Weak diversification

The 3 months correlation between Aberforth and Kaufman is 0.3. Overlapping area represents the amount of risk that can be diversified away by holding Aberforth Smaller Companies and Kaufman Et Broad in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kaufman Et Broad and Aberforth Smaller 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 Aberforth Smaller Companies are associated (or correlated) with Kaufman Et. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kaufman Et Broad has no effect on the direction of Aberforth Smaller i.e., Aberforth Smaller and Kaufman Et go up and down completely randomly.

Pair Corralation between Aberforth Smaller and Kaufman Et

Assuming the 90 days trading horizon Aberforth Smaller Companies is expected to generate 0.49 times more return on investment than Kaufman Et. However, Aberforth Smaller Companies is 2.05 times less risky than Kaufman Et. It trades about 0.3 of its potential returns per unit of risk. Kaufman Et Broad is currently generating about 0.01 per unit of risk. If you would invest  133,800  in Aberforth Smaller Companies on April 23, 2025 and sell it today you would earn a total of  22,600  from holding Aberforth Smaller Companies or generate 16.89% return on investment over 90 days.

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

Aberforth Smaller Companies  vs.  Kaufman Et Broad

Aberforth Smaller

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Aberforth Smaller Companies are ranked lower than 23 (%) of all global equities and portfolios over the last 90 days. In spite of rather uncertain technical and fundamental indicators, Aberforth Smaller exhibited solid returns over the last few months and may actually be approaching a breakup point.

Kaufman Et Broad

Risk-Adjusted Performance

Very Weak

Over the last 90 days Kaufman Et Broad has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, Kaufman Et is not utilizing all of its potentials. The latest stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with Aberforth Smaller and Kaufman Et

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

The idea behind Aberforth Smaller Companies and Kaufman Et Broad 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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.