Correlation Between Baillie Gifford and Great West
Can any of the company-specific risk be diversified away by investing in both Baillie Gifford and Great West 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 Baillie Gifford and Great West into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Baillie Gifford Eafe and Great West Goldman Sachs, you can compare the effects of market volatilities on Baillie Gifford and Great West 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 Baillie Gifford with a short position of Great West. Check out your portfolio center. Please also check ongoing floating volatility patterns of Baillie Gifford and Great West.
Diversification Opportunities for Baillie Gifford and Great West
-0.57 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Baillie and Great is -0.57. Overlapping area represents the amount of risk that can be diversified away by holding Baillie Gifford Eafe and Great West Goldman Sachs in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Great West Goldman and Baillie Gifford 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 Baillie Gifford Eafe are associated (or correlated) with Great West. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Great West Goldman has no effect on the direction of Baillie Gifford i.e., Baillie Gifford and Great West go up and down completely randomly.
Pair Corralation between Baillie Gifford and Great West
Assuming the 90 days horizon Baillie Gifford is expected to generate 2.47 times less return on investment than Great West. In addition to that, Baillie Gifford is 1.18 times more volatile than Great West Goldman Sachs. It trades about 0.05 of its total potential returns per unit of risk. Great West Goldman Sachs is currently generating about 0.13 per unit of volatility. If you would invest 756.00 in Great West Goldman Sachs on September 14, 2024 and sell it today you would earn a total of 247.00 from holding Great West Goldman Sachs or generate 32.67% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Baillie Gifford Eafe vs. Great West Goldman Sachs
Performance |
| Timeline |
| Baillie Gifford Eafe |
| Great West Goldman |
Baillie Gifford and Great West Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Baillie Gifford and Great West
The main advantage of trading using opposite Baillie Gifford and Great West positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Baillie Gifford position performs unexpectedly, Great West 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 Great West will offset losses from the drop in Great West's long position.| Baillie Gifford vs. Great West Goldman Sachs | Baillie Gifford vs. Short Precious Metals | Baillie Gifford vs. Goldman Sachs Clean | Baillie Gifford vs. Oppenheimer Gold Special |
| Great West vs. Dana Large Cap | Great West vs. Large Cap Growth Profund | Great West vs. Lord Abbett Affiliated | Great West vs. Pace Large Value |
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 Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
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