Correlation Between Baillie Gifford and Vanguard Short-term
Can any of the company-specific risk be diversified away by investing in both Baillie Gifford and Vanguard Short-term 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 Vanguard Short-term 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 Vanguard Short Term Investment Grade, you can compare the effects of market volatilities on Baillie Gifford and Vanguard Short-term 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 Vanguard Short-term. Check out your portfolio center. Please also check ongoing floating volatility patterns of Baillie Gifford and Vanguard Short-term.
Diversification Opportunities for Baillie Gifford and Vanguard Short-term
0.46 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Baillie and Vanguard is 0.46. Overlapping area represents the amount of risk that can be diversified away by holding Baillie Gifford Health and Vanguard Short Term Investment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Vanguard Short Term 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 Vanguard Short-term. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Vanguard Short Term has no effect on the direction of Baillie Gifford i.e., Baillie Gifford and Vanguard Short-term go up and down completely randomly.
Pair Corralation between Baillie Gifford and Vanguard Short-term
Assuming the 90 days horizon Baillie Gifford Health is expected to under-perform the Vanguard Short-term. In addition to that, Baillie Gifford is 6.81 times more volatile than Vanguard Short Term Investment Grade. It trades about -0.03 of its total potential returns per unit of risk. Vanguard Short Term Investment Grade is currently generating about 0.11 per unit of volatility. If you would invest 952.00 in Vanguard Short Term Investment Grade on August 30, 2024 and sell it today you would earn a total of 82.00 from holding Vanguard Short Term Investment Grade or generate 8.61% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Baillie Gifford Health vs. Vanguard Short Term Investment
Performance |
| Timeline |
| Baillie Gifford Health |
| Vanguard Short Term |
Baillie Gifford and Vanguard Short-term Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Baillie Gifford and Vanguard Short-term
The main advantage of trading using opposite Baillie Gifford and Vanguard Short-term positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Baillie Gifford position performs unexpectedly, Vanguard Short-term 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 Vanguard Short-term will offset losses from the drop in Vanguard Short-term's long position.| Baillie Gifford vs. Fidelity Advisor Technology | Baillie Gifford vs. Fidelity Advisor Biotechnology | Baillie Gifford vs. Fidelity Advisor Financial | Baillie Gifford vs. Fidelity Advisor Utilities |
| Vanguard Short-term vs. Ppm High Yield | Vanguard Short-term vs. California High Yield Municipal | Vanguard Short-term vs. Western Asset High | Vanguard Short-term vs. Multimanager Lifestyle Aggressive |
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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
Other Complementary Tools
| Money Managers Screen money managers from public funds and ETFs managed around the world | |
| Portfolio Anywhere Track or share privately all of your investments from the convenience of any device | |
| Economic Indicators Top statistical indicators that provide insights into how an economy is performing | |
| Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings | |
| Stocks Directory Find actively traded stocks across global markets |