Correlation Between Baillie Gifford and Guidemark Smallmid
Can any of the company-specific risk be diversified away by investing in both Baillie Gifford and Guidemark Smallmid 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 Guidemark Smallmid into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Baillie Gifford Health and Guidemark Smallmid Cap, you can compare the effects of market volatilities on Baillie Gifford and Guidemark Smallmid 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 Guidemark Smallmid. Check out your portfolio center. Please also check ongoing floating volatility patterns of Baillie Gifford and Guidemark Smallmid.
Diversification Opportunities for Baillie Gifford and Guidemark Smallmid
-0.58 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Baillie and Guidemark is -0.58. Overlapping area represents the amount of risk that can be diversified away by holding Baillie Gifford Health and Guidemark Smallmid Cap in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guidemark Smallmid Cap 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 Health are associated (or correlated) with Guidemark Smallmid. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guidemark Smallmid Cap has no effect on the direction of Baillie Gifford i.e., Baillie Gifford and Guidemark Smallmid go up and down completely randomly.
Pair Corralation between Baillie Gifford and Guidemark Smallmid
Assuming the 90 days horizon Baillie Gifford Health is expected to under-perform the Guidemark Smallmid. In addition to that, Baillie Gifford is 2.85 times more volatile than Guidemark Smallmid Cap. It trades about -0.01 of its total potential returns per unit of risk. Guidemark Smallmid Cap is currently generating about 0.06 per unit of volatility. If you would invest 2,246 in Guidemark Smallmid Cap on September 13, 2024 and sell it today you would earn a total of 23.00 from holding Guidemark Smallmid Cap or generate 1.02% 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 Health vs. Guidemark Smallmid Cap
Performance |
| Timeline |
| Baillie Gifford Health |
| Guidemark Smallmid Cap |
Baillie Gifford and Guidemark Smallmid Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Baillie Gifford and Guidemark Smallmid
The main advantage of trading using opposite Baillie Gifford and Guidemark Smallmid positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Baillie Gifford position performs unexpectedly, Guidemark Smallmid 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 Guidemark Smallmid will offset losses from the drop in Guidemark Smallmid's long position.| Baillie Gifford vs. The International Smaller | Baillie Gifford vs. The International Smaller | Baillie Gifford vs. The International Equity | Baillie Gifford vs. The Eafe Pure |
| Guidemark Smallmid vs. Fidelity Advisor Gold | Guidemark Smallmid vs. James Balanced Golden | Guidemark Smallmid vs. Vy Goldman Sachs | Guidemark Smallmid vs. Oppenheimer Gold Special |
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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
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