Correlation Between Baillie Gifford and Aqr Managed
Can any of the company-specific risk be diversified away by investing in both Baillie Gifford and Aqr Managed 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 Aqr Managed 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 Aqr Managed Futures, you can compare the effects of market volatilities on Baillie Gifford and Aqr Managed 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 Aqr Managed. Check out your portfolio center. Please also check ongoing floating volatility patterns of Baillie Gifford and Aqr Managed.
Diversification Opportunities for Baillie Gifford and Aqr Managed
-0.1 | Correlation Coefficient |
Good diversification
The 3 months correlation between Baillie and Aqr is -0.1. Overlapping area represents the amount of risk that can be diversified away by holding Baillie Gifford Health and Aqr Managed Futures in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aqr Managed Futures 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 Aqr Managed. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aqr Managed Futures has no effect on the direction of Baillie Gifford i.e., Baillie Gifford and Aqr Managed go up and down completely randomly.
Pair Corralation between Baillie Gifford and Aqr Managed
Assuming the 90 days horizon Baillie Gifford Health is expected to under-perform the Aqr Managed. In addition to that, Baillie Gifford is 1.7 times more volatile than Aqr Managed Futures. It trades about -0.19 of its total potential returns per unit of risk. Aqr Managed Futures is currently generating about 0.16 per unit of volatility. If you would invest 810.00 in Aqr Managed Futures on August 25, 2024 and sell it today you would earn a total of 23.00 from holding Aqr Managed Futures or generate 2.84% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Baillie Gifford Health vs. Aqr Managed Futures
Performance |
| Timeline |
| Baillie Gifford Health |
| Aqr Managed Futures |
Baillie Gifford and Aqr Managed Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Baillie Gifford and Aqr Managed
The main advantage of trading using opposite Baillie Gifford and Aqr Managed positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Baillie Gifford position performs unexpectedly, Aqr Managed 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 Aqr Managed will offset losses from the drop in Aqr Managed's long position.| Baillie Gifford vs. Jennison Natural Resources | Baillie Gifford vs. Oil Gas Ultrasector | Baillie Gifford vs. Icon Natural Resources | Baillie Gifford vs. Energy Basic Materials |
| Aqr Managed vs. Prudential Health Sciences | Aqr Managed vs. Eventide Healthcare Life | Aqr Managed vs. Fidelity Advisor Health | Aqr Managed 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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
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