Correlation Between Guidestone Growth and Global Bond
Can any of the company-specific risk be diversified away by investing in both Guidestone Growth and Global Bond 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 Guidestone Growth and Global Bond into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Guidestone Growth Equity and Global Bond Fund, you can compare the effects of market volatilities on Guidestone Growth and Global Bond 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 Guidestone Growth with a short position of Global Bond. Check out your portfolio center. Please also check ongoing floating volatility patterns of Guidestone Growth and Global Bond.
Diversification Opportunities for Guidestone Growth and Global Bond
0.32 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Guidestone and Global is 0.32. Overlapping area represents the amount of risk that can be diversified away by holding Guidestone Growth Equity and Global Bond Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Global Bond Fund and Guidestone Growth 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 Guidestone Growth Equity are associated (or correlated) with Global Bond. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Global Bond Fund has no effect on the direction of Guidestone Growth i.e., Guidestone Growth and Global Bond go up and down completely randomly.
Pair Corralation between Guidestone Growth and Global Bond
Assuming the 90 days horizon Guidestone Growth Equity is expected to generate 4.9 times more return on investment than Global Bond. However, Guidestone Growth is 4.9 times more volatile than Global Bond Fund. It trades about 0.07 of its potential returns per unit of risk. Global Bond Fund is currently generating about 0.02 per unit of risk. If you would invest 1,595 in Guidestone Growth Equity on November 1, 2024 and sell it today you would earn a total of 78.00 from holding Guidestone Growth Equity or generate 4.89% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Guidestone Growth Equity vs. Global Bond Fund
Performance |
| Timeline |
| Guidestone Growth Equity |
| Global Bond Fund |
Guidestone Growth and Global Bond Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Guidestone Growth and Global Bond
The main advantage of trading using opposite Guidestone Growth and Global Bond positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Guidestone Growth position performs unexpectedly, Global Bond 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 Global Bond will offset losses from the drop in Global Bond's long position.| Guidestone Growth vs. Growth Allocation Fund | Guidestone Growth vs. Value Equity Investor | Guidestone Growth vs. Guidestone Value Equity | Guidestone Growth vs. Guidestone Value Equity |
| Global Bond vs. Growth Allocation Fund | Global Bond vs. Defensive Market Strategies | Global Bond vs. Defensive Market Strategies | Global Bond vs. Value Equity Institutional |
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 Commodity Directory module to find actively traded commodities issued by global exchanges.
Other Complementary Tools
| Piotroski F Score Get Piotroski F Score based on the binary analysis strategy of nine different fundamentals | |
| Latest Portfolios Quick portfolio dashboard that showcases your latest portfolios | |
| Price Ceiling Movement Calculate and plot Price Ceiling Movement for different equity instruments | |
| Funds Screener Find actively-traded funds from around the world traded on over 30 global exchanges | |
| My Watchlist Analysis Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like |