Correlation Between Eafe Pure and Baillie Gifford
Can any of the company-specific risk be diversified away by investing in both Eafe Pure and Baillie Gifford 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 Eafe Pure and Baillie Gifford into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between The Eafe Pure and Baillie Gifford International, you can compare the effects of market volatilities on Eafe Pure and Baillie Gifford 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 Eafe Pure with a short position of Baillie Gifford. Check out your portfolio center. Please also check ongoing floating volatility patterns of Eafe Pure and Baillie Gifford.
Diversification Opportunities for Eafe Pure and Baillie Gifford
0.87 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Eafe and Baillie is 0.87. Overlapping area represents the amount of risk that can be diversified away by holding The Eafe Pure and Baillie Gifford International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Baillie Gifford Inte and Eafe Pure 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 The Eafe Pure are associated (or correlated) with Baillie Gifford. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Baillie Gifford Inte has no effect on the direction of Eafe Pure i.e., Eafe Pure and Baillie Gifford go up and down completely randomly.
Pair Corralation between Eafe Pure and Baillie Gifford
Assuming the 90 days horizon Eafe Pure is expected to generate 1.79 times less return on investment than Baillie Gifford. In addition to that, Eafe Pure is 1.11 times more volatile than Baillie Gifford International. It trades about 0.01 of its total potential returns per unit of risk. Baillie Gifford International is currently generating about 0.02 per unit of volatility. If you would invest 1,248 in Baillie Gifford International on October 20, 2024 and sell it today you would earn a total of 48.00 from holding Baillie Gifford International or generate 3.85% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 99.6% |
| Values | Daily Returns |
The Eafe Pure vs. Baillie Gifford International
Performance |
| Timeline |
| Eafe Pure |
| Baillie Gifford Inte |
Eafe Pure and Baillie Gifford Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Eafe Pure and Baillie Gifford
The main advantage of trading using opposite Eafe Pure and Baillie Gifford positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Eafe Pure position performs unexpectedly, Baillie Gifford 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 Baillie Gifford will offset losses from the drop in Baillie Gifford's long position.| Eafe Pure vs. Blackrock High Yield | Eafe Pure vs. High Yield Fund A | Eafe Pure vs. Buffalo High Yield | Eafe Pure vs. Voya High Yield |
| Baillie Gifford vs. International Investors Gold | Baillie Gifford vs. James Balanced Golden | Baillie Gifford vs. Short Precious Metals | Baillie Gifford vs. World Precious Minerals |
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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
Other Complementary Tools
| Money Managers Screen money managers from public funds and ETFs managed around the world | |
| Efficient Frontier Plot and analyze your portfolio and positions against risk-return landscape of the market. | |
| Premium Stories Follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope | |
| Global Markets Map Get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes | |
| Instant Ratings Determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance |