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 Eafe, 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
-0.43 | Correlation Coefficient |
Very good diversification
The 3 months correlation between ABVCX and Baillie is -0.43. Overlapping area represents the amount of risk that can be diversified away by holding Ab Value Fund and Baillie Gifford Eafe in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Baillie Gifford Eafe 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 Eafe 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 0.93 times more return on investment than Baillie Gifford. However, Ab Value Fund is 1.08 times less risky than Baillie Gifford. It trades about 0.35 of its potential returns per unit of risk. Baillie Gifford Eafe is currently generating about -0.11 per unit of risk. If you would invest 1,941 in Ab Value Fund on August 31, 2024 and sell it today you would earn a total of 129.00 from holding Ab Value Fund or generate 6.65% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ab Value Fund vs. Baillie Gifford Eafe
Performance |
| Timeline |
| Ab Value Fund |
| Baillie Gifford Eafe |
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. Mesirow Financial Small | Ab Value vs. John Hancock Financial | Ab Value vs. Royce Global Financial | Ab Value vs. Goldman Sachs Financial |
| Baillie Gifford vs. Vanguard Small Cap Growth | Baillie Gifford vs. Commonwealth Global Fund | Baillie Gifford vs. Ab Value Fund | Baillie Gifford vs. Bbh Partner Fund |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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