Correlation Between Kaufman Et and Baillie Gifford

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Can any of the company-specific risk be diversified away by investing in both Kaufman Et and Baillie Gifford 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 Kaufman Et and Baillie Gifford into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kaufman Et Broad and Baillie Gifford European, you can compare the effects of market volatilities on Kaufman Et and Baillie Gifford 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 Kaufman Et with a short position of Baillie Gifford. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kaufman Et and Baillie Gifford.

Diversification Opportunities for Kaufman Et and Baillie Gifford

KaufmanBaillieDiversified AwayKaufmanBaillieDiversified Away100%
0.54
  Correlation Coefficient

Very weak diversification

The 3 months correlation between Kaufman and Baillie is 0.54. Overlapping area represents the amount of risk that can be diversified away by holding Kaufman Et Broad and Baillie Gifford European in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Baillie Gifford European and Kaufman Et 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 Kaufman Et Broad are associated (or correlated) with Baillie Gifford. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Baillie Gifford European has no effect on the direction of Kaufman Et i.e., Kaufman Et and Baillie Gifford go up and down completely randomly.

Pair Corralation between Kaufman Et and Baillie Gifford

Assuming the 90 days trading horizon Kaufman Et Broad is expected to generate 1.72 times more return on investment than Baillie Gifford. However, Kaufman Et is 1.72 times more volatile than Baillie Gifford European. It trades about 0.05 of its potential returns per unit of risk. Baillie Gifford European is currently generating about 0.02 per unit of risk. If you would invest  2,246  in Kaufman Et Broad on November 30, 2024 and sell it today you would earn a total of  1,049  from holding Kaufman Et Broad or generate 46.71% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthWeak
Accuracy99.8%
ValuesDaily Returns

Kaufman Et Broad  vs.  Baillie Gifford European

 Performance 
JavaScript chart by amCharts 3.21.15Dec2025Feb -15-10-505
JavaScript chart by amCharts 3.21.150F07 BGEU
       Timeline  
Kaufman Et Broad 

Risk-Adjusted Performance

Insignificant

 
Weak
 
Strong
Compared to the overall equity markets, risk-adjusted returns on investments in Kaufman Et Broad are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively unsteady basic indicators, Kaufman Et may actually be approaching a critical reversion point that can send shares even higher in March 2025.
JavaScript chart by amCharts 3.21.15JanFebFeb30.53131.53232.53333.534
Baillie Gifford European 

Risk-Adjusted Performance

Solid

 
Weak
 
Strong
Compared to the overall equity markets, risk-adjusted returns on investments in Baillie Gifford European are ranked lower than 20 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively unsteady basic indicators, Baillie Gifford unveiled solid returns over the last few months and may actually be approaching a breakup point.
JavaScript chart by amCharts 3.21.15JanFebFeb859095100

Kaufman Et and Baillie Gifford Volatility Contrast

   Predicted Return Density   
JavaScript chart by amCharts 3.21.15-4.37-3.27-2.18-1.080.01871.122.243.374.49 0.10.20.30.4
JavaScript chart by amCharts 3.21.150F07 BGEU
       Returns  

Pair Trading with Kaufman Et and Baillie Gifford

The main advantage of trading using opposite Kaufman Et and Baillie Gifford positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kaufman Et position performs unexpectedly, Baillie Gifford 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 Baillie Gifford will offset losses from the drop in Baillie Gifford's long position.
The idea behind Kaufman Et Broad and Baillie Gifford European 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 Portfolio Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.

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