Correlation Between Financial Industries and Baillie Gifford
Can any of the company-specific risk be diversified away by investing in both Financial Industries 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 Financial Industries and Baillie Gifford into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Financial Industries Fund and Baillie Gifford Health, you can compare the effects of market volatilities on Financial Industries 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 Financial Industries with a short position of Baillie Gifford. Check out your portfolio center. Please also check ongoing floating volatility patterns of Financial Industries and Baillie Gifford.
Diversification Opportunities for Financial Industries and Baillie Gifford
-0.02 | Correlation Coefficient |
Good diversification
The 3 months correlation between Financial and Baillie is -0.02. Overlapping area represents the amount of risk that can be diversified away by holding Financial Industries Fund and Baillie Gifford Health in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Baillie Gifford Health and Financial Industries 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 Financial Industries Fund 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 Health has no effect on the direction of Financial Industries i.e., Financial Industries and Baillie Gifford go up and down completely randomly.
Pair Corralation between Financial Industries and Baillie Gifford
If you would invest 1,818 in Financial Industries Fund on November 6, 2024 and sell it today you would earn a total of 86.00 from holding Financial Industries Fund or generate 4.73% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Financial Industries Fund vs. Baillie Gifford Health
Performance |
| Timeline |
| Financial Industries |
| Baillie Gifford Health |
Financial Industries and Baillie Gifford Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Financial Industries and Baillie Gifford
The main advantage of trading using opposite Financial Industries and Baillie Gifford positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Financial Industries 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.| Financial Industries vs. Payden High Income | Financial Industries vs. Prudential High Yield | Financial Industries vs. Dunham High Yield | Financial Industries vs. Buffalo High Yield |
| Baillie Gifford vs. T Rowe Price | Baillie Gifford vs. Rational Strategic Allocation | Baillie Gifford vs. Pnc Balanced Allocation | Baillie Gifford vs. Rbb Fund |
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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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