Correlation Between Guidestone Funds and Medium-duration Bond
Can any of the company-specific risk be diversified away by investing in both Guidestone Funds and Medium-duration 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 Funds and Medium-duration Bond into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Guidestone Funds and Medium Duration Bond Institutional, you can compare the effects of market volatilities on Guidestone Funds and Medium-duration 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 Funds with a short position of Medium-duration Bond. Check out your portfolio center. Please also check ongoing floating volatility patterns of Guidestone Funds and Medium-duration Bond.
Diversification Opportunities for Guidestone Funds and Medium-duration Bond
0.98 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Guidestone and Medium-duration is 0.98. Overlapping area represents the amount of risk that can be diversified away by holding Guidestone Funds and Medium Duration Bond Instituti in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Medium Duration Bond and Guidestone Funds 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 Funds are associated (or correlated) with Medium-duration Bond. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Medium Duration Bond has no effect on the direction of Guidestone Funds i.e., Guidestone Funds and Medium-duration Bond go up and down completely randomly.
Pair Corralation between Guidestone Funds and Medium-duration Bond
Assuming the 90 days horizon Guidestone Funds is expected to generate 1.15 times less return on investment than Medium-duration Bond. In addition to that, Guidestone Funds is 1.01 times more volatile than Medium Duration Bond Institutional. It trades about 0.27 of its total potential returns per unit of risk. Medium Duration Bond Institutional is currently generating about 0.31 per unit of volatility. If you would invest 1,240 in Medium Duration Bond Institutional on November 9, 2024 and sell it today you would earn a total of 24.00 from holding Medium Duration Bond Institutional or generate 1.94% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Guidestone Funds vs. Medium Duration Bond Instituti
Performance |
| Timeline |
| Guidestone Funds |
| Medium Duration Bond |
Guidestone Funds and Medium-duration Bond Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Guidestone Funds and Medium-duration Bond
The main advantage of trading using opposite Guidestone Funds and Medium-duration Bond positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Guidestone Funds position performs unexpectedly, Medium-duration 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 Medium-duration Bond will offset losses from the drop in Medium-duration Bond's long position.| Guidestone Funds vs. The Gabelli Healthcare | Guidestone Funds vs. Hartford Healthcare Hls | Guidestone Funds vs. Health Care Fund | Guidestone Funds vs. Blackrock Health Sciences |
| Medium-duration Bond vs. Gamco Global Opportunity | Medium-duration Bond vs. Morningstar Global Income | Medium-duration Bond vs. Barings Global Floating | Medium-duration Bond vs. Investec Global Franchise |
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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
Other Complementary Tools
| FinTech Suite Use AI to screen and filter profitable investment opportunities | |
| Money Flow Index Determine momentum by analyzing Money Flow Index and other technical indicators | |
| Stocks Directory Find actively traded stocks across global markets | |
| Crypto Correlations Use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins | |
| Price Transformation Use Price Transformation models to analyze the depth of different equity instruments across global markets |