Correlation Between Baillie Gifford and Touchstone Large
Can any of the company-specific risk be diversified away by investing in both Baillie Gifford and Touchstone Large 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 Touchstone Large into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Baillie Gifford International and Touchstone Large Cap, you can compare the effects of market volatilities on Baillie Gifford and Touchstone Large 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 Touchstone Large. Check out your portfolio center. Please also check ongoing floating volatility patterns of Baillie Gifford and Touchstone Large.
Diversification Opportunities for Baillie Gifford and Touchstone Large
0.71 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Baillie and Touchstone is 0.71. Overlapping area represents the amount of risk that can be diversified away by holding Baillie Gifford International and Touchstone Large Cap in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Touchstone Large Cap 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 International are associated (or correlated) with Touchstone Large. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Touchstone Large Cap has no effect on the direction of Baillie Gifford i.e., Baillie Gifford and Touchstone Large go up and down completely randomly.
Pair Corralation between Baillie Gifford and Touchstone Large
Assuming the 90 days horizon Baillie Gifford International is expected to generate 1.21 times more return on investment than Touchstone Large. However, Baillie Gifford is 1.21 times more volatile than Touchstone Large Cap. It trades about 0.17 of its potential returns per unit of risk. Touchstone Large Cap is currently generating about 0.11 per unit of risk. If you would invest 1,372 in Baillie Gifford International on December 4, 2024 and sell it today you would earn a total of 43.00 from holding Baillie Gifford International or generate 3.13% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.24% |
| Values | Daily Returns |
Baillie Gifford International vs. Touchstone Large Cap
Performance |
| Timeline |
| Baillie Gifford Inte |
| Touchstone Large Cap |
Baillie Gifford and Touchstone Large Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Baillie Gifford and Touchstone Large
The main advantage of trading using opposite Baillie Gifford and Touchstone Large positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Baillie Gifford position performs unexpectedly, Touchstone Large 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 Touchstone Large will offset losses from the drop in Touchstone Large's long position.| Baillie Gifford vs. Gamco Global Gold | Baillie Gifford vs. Precious Metals And | Baillie Gifford vs. Franklin Gold Precious | Baillie Gifford vs. First Eagle Gold |
| Touchstone Large vs. Touchstone Ultra Short | Touchstone Large vs. Angel Oak Ultrashort | Touchstone Large vs. Blackrock Global Longshort | Touchstone Large vs. Seix Govt Sec |
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 Stocks Directory module to find actively traded stocks across global markets.
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