Correlation Between Baillie Gifford and Health Care
Can any of the company-specific risk be diversified away by investing in both Baillie Gifford and Health Care 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 Health Care 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 Health Care Fund, you can compare the effects of market volatilities on Baillie Gifford and Health Care 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 Health Care. Check out your portfolio center. Please also check ongoing floating volatility patterns of Baillie Gifford and Health Care.
Diversification Opportunities for Baillie Gifford and Health Care
0.03 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Baillie and Health is 0.03. Overlapping area represents the amount of risk that can be diversified away by holding Baillie Gifford Health and Health Care Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Health Care Fund 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 Health Care. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Health Care Fund has no effect on the direction of Baillie Gifford i.e., Baillie Gifford and Health Care go up and down completely randomly.
Pair Corralation between Baillie Gifford and Health Care
If you would invest 3,700 in Health Care Fund on November 27, 2024 and sell it today you would earn a total of 7,231 from holding Health Care Fund or generate 195.43% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Baillie Gifford Health vs. Health Care Fund
Performance |
| Timeline |
| Baillie Gifford Health |
| Health Care Fund |
Baillie Gifford and Health Care Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Baillie Gifford and Health Care
The main advantage of trading using opposite Baillie Gifford and Health Care positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Baillie Gifford position performs unexpectedly, Health Care 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 Health Care will offset losses from the drop in Health Care's long position.| Baillie Gifford vs. Nexpoint Real Estate | Baillie Gifford vs. Prudential Real Estate | Baillie Gifford vs. Short Real Estate | Baillie Gifford vs. Aew Real Estate |
| Health Care vs. Doubleline Global Bond | Health Care vs. T Rowe Price | Health Care vs. Investec Global Franchise | Health Care vs. Qs Global Equity |
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 Portfolio File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
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