Correlation Between Gmo Global and Aqr Global
Can any of the company-specific risk be diversified away by investing in both Gmo Global and Aqr Global 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 Gmo Global and Aqr Global into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Gmo Global Equity and Aqr Global Macro, you can compare the effects of market volatilities on Gmo Global and Aqr Global 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 Gmo Global with a short position of Aqr Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gmo Global and Aqr Global.
Diversification Opportunities for Gmo Global and Aqr Global
0.08 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Gmo and Aqr is 0.08. Overlapping area represents the amount of risk that can be diversified away by holding Gmo Global Equity and Aqr Global Macro in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aqr Global Macro and Gmo Global 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 Gmo Global Equity are associated (or correlated) with Aqr Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aqr Global Macro has no effect on the direction of Gmo Global i.e., Gmo Global and Aqr Global go up and down completely randomly.
Pair Corralation between Gmo Global and Aqr Global
Assuming the 90 days horizon Gmo Global Equity is expected to generate 1.62 times more return on investment than Aqr Global. However, Gmo Global is 1.62 times more volatile than Aqr Global Macro. It trades about 0.06 of its potential returns per unit of risk. Aqr Global Macro is currently generating about 0.01 per unit of risk. If you would invest 2,584 in Gmo Global Equity on November 3, 2024 and sell it today you would earn a total of 350.00 from holding Gmo Global Equity or generate 13.54% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Gmo Global Equity vs. Aqr Global Macro
Performance |
| Timeline |
| Gmo Global Equity |
| Aqr Global Macro |
Gmo Global and Aqr Global Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Gmo Global and Aqr Global
The main advantage of trading using opposite Gmo Global and Aqr Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gmo Global position performs unexpectedly, Aqr Global 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 Aqr Global will offset losses from the drop in Aqr Global's long position.| Gmo Global vs. Tiaa Cref Real Estate | Gmo Global vs. Nexpoint Real Estate | Gmo Global vs. Nexpoint Real Estate | Gmo Global vs. Rreef Property Trust |
| Aqr Global vs. Western Assets Emerging | Aqr Global vs. Angel Oak Multi Strategy | Aqr Global vs. Nasdaq 100 2x Strategy | Aqr Global vs. Doubleline Emerging Markets |
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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
Other Complementary Tools
| Pair Correlation Compare performance and examine fundamental relationship between any two equity instruments | |
| Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas | |
| Technical Analysis Check basic technical indicators and analysis based on most latest market data | |
| Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios | |
| AI Portfolio Architect Use AI to generate optimal portfolios and find profitable investment opportunities |