Correlation Between Sterling Capital and Aqr Sustainable
Can any of the company-specific risk be diversified away by investing in both Sterling Capital and Aqr Sustainable 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 Sterling Capital and Aqr Sustainable into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sterling Capital Short and Aqr Sustainable Long Short, you can compare the effects of market volatilities on Sterling Capital and Aqr Sustainable 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 Sterling Capital with a short position of Aqr Sustainable. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sterling Capital and Aqr Sustainable.
Diversification Opportunities for Sterling Capital and Aqr Sustainable
0.06 | Correlation Coefficient |
Significant diversification
The 3 months correlation between STERLING and AQR is 0.06. Overlapping area represents the amount of risk that can be diversified away by holding Sterling Capital Short and Aqr Sustainable Long Short in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aqr Sustainable Long and Sterling Capital 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 Sterling Capital Short are associated (or correlated) with Aqr Sustainable. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aqr Sustainable Long has no effect on the direction of Sterling Capital i.e., Sterling Capital and Aqr Sustainable go up and down completely randomly.
Pair Corralation between Sterling Capital and Aqr Sustainable
Assuming the 90 days horizon Sterling Capital is expected to generate 6.35 times less return on investment than Aqr Sustainable. But when comparing it to its historical volatility, Sterling Capital Short is 10.32 times less risky than Aqr Sustainable. It trades about 0.13 of its potential returns per unit of risk. Aqr Sustainable Long Short is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 907.00 in Aqr Sustainable Long Short on September 2, 2024 and sell it today you would earn a total of 596.00 from holding Aqr Sustainable Long Short or generate 65.71% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sterling Capital Short vs. Aqr Sustainable Long Short
Performance |
| Timeline |
| Sterling Capital Short |
| Aqr Sustainable Long |
Sterling Capital and Aqr Sustainable Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sterling Capital and Aqr Sustainable
The main advantage of trading using opposite Sterling Capital and Aqr Sustainable positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sterling Capital position performs unexpectedly, Aqr Sustainable 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 Aqr Sustainable will offset losses from the drop in Aqr Sustainable's long position.| Sterling Capital vs. Sterling Capital Equity | Sterling Capital vs. Sterling Capital Behavioral | Sterling Capital vs. Sterling Capital South | Sterling Capital vs. Sterling Capital South |
| Aqr Sustainable vs. Pimco Funds | Aqr Sustainable vs. Prudential Government Money | Aqr Sustainable vs. Aim Investment Secs | Aqr Sustainable vs. Dreyfus Institutional Reserves |
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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
Other Complementary Tools
| Bollinger Bands Use Bollinger Bands indicator to analyze target price for a given investing horizon | |
| Crypto Correlations Use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins | |
| Idea Optimizer Use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio | |
| Technical Analysis Check basic technical indicators and analysis based on most latest market data | |
| Global Markets Map Get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes |