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 Health and Great West Sp 500, 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
-0.46 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Baillie and Great-west is -0.46. Overlapping area represents the amount of risk that can be diversified away by holding Baillie Gifford Health and Great West Sp 500 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Great West Sp 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 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 Sp 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 Health is expected to under-perform the Great-west. In addition to that, Baillie Gifford is 1.26 times more volatile than Great West Sp 500. It trades about -0.02 of its total potential returns per unit of risk. Great West Sp 500 is currently generating about 0.05 per unit of volatility. If you would invest 782.00 in Great West Sp 500 on September 4, 2024 and sell it today you would earn a total of 211.00 from holding Great West Sp 500 or generate 26.98% 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. Great West Sp 500
Performance |
| Timeline |
| Baillie Gifford Health |
| Great West Sp |
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. T Rowe Price | Baillie Gifford vs. T Rowe Price | Baillie Gifford vs. Cs 607 Tax | Baillie Gifford vs. Franklin High Yield |
| Great-west vs. Deutsche Health And | Great-west vs. Blackrock Health Sciences | Great-west vs. Fidelity Advisor Health | Great-west 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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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