Correlation Between Baillie Gifford and Templeton Growth
Can any of the company-specific risk be diversified away by investing in both Baillie Gifford and Templeton Growth 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 Templeton Growth 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 Templeton Growth Fund, you can compare the effects of market volatilities on Baillie Gifford and Templeton Growth 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 Templeton Growth. Check out your portfolio center. Please also check ongoing floating volatility patterns of Baillie Gifford and Templeton Growth.
Diversification Opportunities for Baillie Gifford and Templeton Growth
0.32 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Baillie and Templeton is 0.32. Overlapping area represents the amount of risk that can be diversified away by holding Baillie Gifford Health and Templeton Growth Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Templeton Growth 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 Templeton Growth. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Templeton Growth has no effect on the direction of Baillie Gifford i.e., Baillie Gifford and Templeton Growth go up and down completely randomly.
Pair Corralation between Baillie Gifford and Templeton Growth
Assuming the 90 days horizon Baillie Gifford Health is expected to generate 0.36 times more return on investment than Templeton Growth. However, Baillie Gifford Health is 2.78 times less risky than Templeton Growth. It trades about -0.3 of its potential returns per unit of risk. Templeton Growth Fund is currently generating about -0.26 per unit of risk. If you would invest 584.00 in Baillie Gifford Health on October 12, 2024 and sell it today you would lose (11.00) from holding Baillie Gifford Health or give up 1.88% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Baillie Gifford Health vs. Templeton Growth Fund
Performance |
| Timeline |
| Baillie Gifford Health |
| Templeton Growth |
Baillie Gifford and Templeton Growth Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Baillie Gifford and Templeton Growth
The main advantage of trading using opposite Baillie Gifford and Templeton Growth positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Baillie Gifford position performs unexpectedly, Templeton Growth 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 Templeton Growth will offset losses from the drop in Templeton Growth's long position.| Baillie Gifford vs. Highland Longshort Healthcare | Baillie Gifford vs. The Hartford Healthcare | Baillie Gifford vs. The Gabelli Healthcare | Baillie Gifford vs. Blackrock Health Sciences |
| Templeton Growth vs. Invesco Global Health | Templeton Growth vs. Eventide Healthcare Life | Templeton Growth vs. Prudential Health Sciences | Templeton Growth vs. Baillie Gifford Health |
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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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