Correlation Between Ab Impact and Baillie Gifford
Can any of the company-specific risk be diversified away by investing in both Ab Impact 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 Ab Impact and Baillie Gifford into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ab Impact Municipal and Baillie Gifford Emerging, you can compare the effects of market volatilities on Ab Impact 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 Ab Impact with a short position of Baillie Gifford. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ab Impact and Baillie Gifford.
Diversification Opportunities for Ab Impact and Baillie Gifford
-0.05 | Correlation Coefficient |
Good diversification
The 3 months correlation between ABIMX and Baillie is -0.05. Overlapping area represents the amount of risk that can be diversified away by holding Ab Impact Municipal and Baillie Gifford Emerging in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Baillie Gifford Emerging and Ab Impact 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 Ab Impact Municipal 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 Emerging has no effect on the direction of Ab Impact i.e., Ab Impact and Baillie Gifford go up and down completely randomly.
Pair Corralation between Ab Impact and Baillie Gifford
Assuming the 90 days horizon Ab Impact is expected to generate 1.76 times less return on investment than Baillie Gifford. But when comparing it to its historical volatility, Ab Impact Municipal is 3.33 times less risky than Baillie Gifford. It trades about 0.08 of its potential returns per unit of risk. Baillie Gifford Emerging is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 1,677 in Baillie Gifford Emerging on September 4, 2024 and sell it today you would earn a total of 352.00 from holding Baillie Gifford Emerging or generate 20.99% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.8% |
| Values | Daily Returns |
Ab Impact Municipal vs. Baillie Gifford Emerging
Performance |
| Timeline |
| Ab Impact Municipal |
| Baillie Gifford Emerging |
Ab Impact and Baillie Gifford Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ab Impact and Baillie Gifford
The main advantage of trading using opposite Ab Impact and Baillie Gifford positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ab Impact 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.| Ab Impact vs. Ab Global E | Ab Impact vs. Ab Global E | Ab Impact vs. Ab Global E | Ab Impact vs. Ab Minnesota Portfolio |
| Baillie Gifford vs. Touchstone Large Cap | Baillie Gifford vs. Growth Strategy Fund | Baillie Gifford vs. Issachar Fund Class | Baillie Gifford vs. Semiconductor Ultrasector Profund |
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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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