Correlation Between Apple and Baillie Gifford
Can any of the company-specific risk be diversified away by investing in both Apple 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 Apple and Baillie Gifford into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Apple Inc and Baillie Gifford China, you can compare the effects of market volatilities on Apple 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 Apple with a short position of Baillie Gifford. Check out your portfolio center. Please also check ongoing floating volatility patterns of Apple and Baillie Gifford.
Diversification Opportunities for Apple and Baillie Gifford
0.53 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Apple and Baillie is 0.53. Overlapping area represents the amount of risk that can be diversified away by holding Apple Inc and Baillie Gifford China in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Baillie Gifford China and Apple 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 Apple Inc 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 China has no effect on the direction of Apple i.e., Apple and Baillie Gifford go up and down completely randomly.
Pair Corralation between Apple and Baillie Gifford
If you would invest 902.00 in Baillie Gifford China on November 3, 2024 and sell it today you would earn a total of 0.00 from holding Baillie Gifford China or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 4.76% |
| Values | Daily Returns |
Apple Inc vs. Baillie Gifford China
Performance |
| Timeline |
| Apple Inc |
| Baillie Gifford China |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Apple and Baillie Gifford Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Apple and Baillie Gifford
The main advantage of trading using opposite Apple and Baillie Gifford positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Apple 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 Apple Inc and Baillie Gifford China 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.| Baillie Gifford vs. Wesmark Government Bond | Baillie Gifford vs. Schwab Government Money | Baillie Gifford vs. Payden Government Fund | Baillie Gifford vs. Intermediate Government Bond |
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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
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