Correlation Between Highland Opportunities and Alliancebernstein

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

By analyzing existing cross correlation between Highland Opportunities And and Alliancebernstein National Municipal, you can compare the effects of market volatilities on Highland Opportunities and Alliancebernstein 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 Highland Opportunities with a short position of Alliancebernstein. Check out your portfolio center. Please also check ongoing floating volatility patterns of Highland Opportunities and Alliancebernstein.

Diversification Opportunities for Highland Opportunities and Alliancebernstein

0.65

Correlation Coefficient

Highland Opportunities  Alliancebernstein

Poor diversification

The 3 months correlation between Highland and Alliancebernstein is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding Highland Opportunities And and Alliancebernstein National Mun in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Alliancebernstein and Highland Opportunities 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 Highland Opportunities And are associated (or correlated) with Alliancebernstein. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Alliancebernstein has no effect on the direction of Highland Opportunities i.e., Highland Opportunities and Alliancebernstein go up and down completely randomly.

Pair Corralation between Highland Opportunities and Alliancebernstein

Given the investment horizon of 90 days Highland Opportunities And is expected to under-perform the Alliancebernstein. In addition to that, Highland Opportunities is 2.59 times more volatile than Alliancebernstein National Municipal. It trades about -0.06 of its total potential returns per unit of risk. Alliancebernstein National Municipal is currently generating about -0.14 per unit of volatility. If you would invest  1,115  in Alliancebernstein National Municipal on March 4, 2025 and sell it today you would lose (80.00) from holding Alliancebernstein National Municipal or give up 7.17% of portfolio value over 90 days.

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

Highland Opportunities And  vs.  Alliancebernstein National Mun

Highland Opportunities

Risk-Adjusted Performance

Very Weak

Over the last 90 days Highland Opportunities And has generated negative risk-adjusted returns adding no value to fund investors. In spite of latest fragile performance, the Fund's basic indicators remain healthy and the recent disarray on Wall Street may also be a sign of long period gains for the fund investors.

Alliancebernstein

Risk-Adjusted Performance

Very Weak

Over the last 90 days Alliancebernstein National Municipal has generated negative risk-adjusted returns adding no value to fund investors. Despite latest fragile performance, the Fund's technical and fundamental indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the fund investors.

Pair Trading with Highland Opportunities and Alliancebernstein

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

The idea behind Highland Opportunities And and Alliancebernstein National Municipal 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 Bonds Directory module to find actively traded corporate debentures issued by US companies.