Correlation Between Baillie Gifford and Hotchkis Wiley
Can any of the company-specific risk be diversified away by investing in both Baillie Gifford and Hotchkis Wiley 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 Hotchkis Wiley 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 Hotchkis Wiley High, you can compare the effects of market volatilities on Baillie Gifford and Hotchkis Wiley 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 Hotchkis Wiley. Check out your portfolio center. Please also check ongoing floating volatility patterns of Baillie Gifford and Hotchkis Wiley.
Diversification Opportunities for Baillie Gifford and Hotchkis Wiley
-0.35 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Baillie and Hotchkis is -0.35. Overlapping area represents the amount of risk that can be diversified away by holding Baillie Gifford Health and Hotchkis Wiley High in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hotchkis Wiley High 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 Hotchkis Wiley. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hotchkis Wiley High has no effect on the direction of Baillie Gifford i.e., Baillie Gifford and Hotchkis Wiley go up and down completely randomly.
Pair Corralation between Baillie Gifford and Hotchkis Wiley
Assuming the 90 days horizon Baillie Gifford is expected to generate 1.67 times less return on investment than Hotchkis Wiley. In addition to that, Baillie Gifford is 7.09 times more volatile than Hotchkis Wiley High. It trades about 0.02 of its total potential returns per unit of risk. Hotchkis Wiley High is currently generating about 0.24 per unit of volatility. If you would invest 1,008 in Hotchkis Wiley High on September 1, 2024 and sell it today you would earn a total of 51.00 from holding Hotchkis Wiley High or generate 5.06% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.21% |
| Values | Daily Returns |
Baillie Gifford Health vs. Hotchkis Wiley High
Performance |
| Timeline |
| Baillie Gifford Health |
| Hotchkis Wiley High |
Baillie Gifford and Hotchkis Wiley Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Baillie Gifford and Hotchkis Wiley
The main advantage of trading using opposite Baillie Gifford and Hotchkis Wiley positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Baillie Gifford position performs unexpectedly, Hotchkis Wiley 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 Hotchkis Wiley will offset losses from the drop in Hotchkis Wiley's long position.| Baillie Gifford vs. The Eafe Pure | Baillie Gifford vs. The Long Term | Baillie Gifford vs. Baillie Gifford International | Baillie Gifford vs. Baillie Gifford International |
| Hotchkis Wiley vs. Hw Opportunities Mp | Hotchkis Wiley vs. Hotchkis Wiley Value | Hotchkis Wiley vs. Hotchkis Wiley Value | Hotchkis Wiley vs. Hotchkis Wiley 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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
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