Correlation Between Ab Value and Baillie Gifford
Can any of the company-specific risk be diversified away by investing in both Ab Value 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 Value 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 Value Fund and Baillie Gifford Emerging, you can compare the effects of market volatilities on Ab Value 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 Value with a short position of Baillie Gifford. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ab Value and Baillie Gifford.
Diversification Opportunities for Ab Value and Baillie Gifford
-0.2 | Correlation Coefficient |
Good diversification
The 3 months correlation between ABVCX and Baillie is -0.2. Overlapping area represents the amount of risk that can be diversified away by holding Ab Value Fund 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 Value 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 Value Fund 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 Value i.e., Ab Value and Baillie Gifford go up and down completely randomly.
Pair Corralation between Ab Value and Baillie Gifford
Assuming the 90 days horizon Ab Value Fund is expected to generate 0.73 times more return on investment than Baillie Gifford. However, Ab Value Fund is 1.37 times less risky than Baillie Gifford. It trades about 0.14 of its potential returns per unit of risk. Baillie Gifford Emerging is currently generating about 0.05 per unit of risk. If you would invest 1,667 in Ab Value Fund on September 3, 2024 and sell it today you would earn a total of 409.00 from holding Ab Value Fund or generate 24.54% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ab Value Fund vs. Baillie Gifford Emerging
Performance |
| Timeline |
| Ab Value Fund |
| Baillie Gifford Emerging |
Ab Value and Baillie Gifford Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ab Value and Baillie Gifford
The main advantage of trading using opposite Ab Value and Baillie Gifford positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ab Value 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 Value vs. Vanguard Value Index | Ab Value vs. Dodge Cox Stock | Ab Value vs. American Mutual Fund | Ab Value vs. American Funds American |
| Baillie Gifford vs. Qs Large Cap | Baillie Gifford vs. Vela Large Cap | Baillie Gifford vs. Tax Managed Large Cap | Baillie Gifford vs. Transamerica Large Cap |
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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
Other Complementary Tools
| CEOs Directory Screen CEOs from public companies around the world | |
| Idea Optimizer Use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio | |
| Idea Breakdown Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes | |
| FinTech Suite Use AI to screen and filter profitable investment opportunities | |
| Global Correlations Find global opportunities by holding instruments from different markets |