Correlation Between Ab Bond and Baillie Gifford
Can any of the company-specific risk be diversified away by investing in both Ab Bond 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 Bond 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 Bond Inflation and Baillie Gifford China, you can compare the effects of market volatilities on Ab Bond 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 Bond with a short position of Baillie Gifford. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ab Bond and Baillie Gifford.
Diversification Opportunities for Ab Bond and Baillie Gifford
-0.3 | Correlation Coefficient |
Very good diversification
The 3 months correlation between ABNTX and Baillie is -0.3. Overlapping area represents the amount of risk that can be diversified away by holding Ab Bond Inflation 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 Ab Bond 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 Bond Inflation 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 Ab Bond i.e., Ab Bond and Baillie Gifford go up and down completely randomly.
Pair Corralation between Ab Bond and Baillie Gifford
Assuming the 90 days horizon Ab Bond Inflation is expected to generate 0.19 times more return on investment than Baillie Gifford. However, Ab Bond Inflation is 5.32 times less risky than Baillie Gifford. It trades about 0.06 of its potential returns per unit of risk. Baillie Gifford China is currently generating about -0.04 per unit of risk. If you would invest 939.00 in Ab Bond Inflation on September 3, 2024 and sell it today you would earn a total of 79.00 from holding Ab Bond Inflation or generate 8.41% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ab Bond Inflation vs. Baillie Gifford China
Performance |
| Timeline |
| Ab Bond Inflation |
| Baillie Gifford China |
Ab Bond and Baillie Gifford Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ab Bond and Baillie Gifford
The main advantage of trading using opposite Ab Bond and Baillie Gifford positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ab Bond 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 Bond vs. Blackrock High Yield | Ab Bond vs. Pgim High Yield | Ab Bond vs. Goldman Sachs High | Ab Bond vs. Gmo High Yield |
| Baillie Gifford vs. General Money Market | Baillie Gifford vs. John Hancock Money | Baillie Gifford vs. Transamerica Funds | Baillie Gifford vs. Blackrock Exchange Portfolio |
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 Portfolio Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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