Correlation Between Guggenheim Risk and Aqr Long
Can any of the company-specific risk be diversified away by investing in both Guggenheim Risk and Aqr Long 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 Guggenheim Risk and Aqr Long into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Guggenheim Risk Managed and Aqr Long Short Equity, you can compare the effects of market volatilities on Guggenheim Risk and Aqr Long 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 Guggenheim Risk with a short position of Aqr Long. Check out your portfolio center. Please also check ongoing floating volatility patterns of Guggenheim Risk and Aqr Long.
Diversification Opportunities for Guggenheim Risk and Aqr Long
0.27 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Guggenheim and Aqr is 0.27. Overlapping area represents the amount of risk that can be diversified away by holding Guggenheim Risk Managed and Aqr Long Short Equity in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aqr Long Short and Guggenheim Risk 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 Guggenheim Risk Managed are associated (or correlated) with Aqr Long. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aqr Long Short has no effect on the direction of Guggenheim Risk i.e., Guggenheim Risk and Aqr Long go up and down completely randomly.
Pair Corralation between Guggenheim Risk and Aqr Long
Assuming the 90 days horizon Guggenheim Risk is expected to generate 1.06 times less return on investment than Aqr Long. In addition to that, Guggenheim Risk is 1.65 times more volatile than Aqr Long Short Equity. It trades about 0.28 of its total potential returns per unit of risk. Aqr Long Short Equity is currently generating about 0.49 per unit of volatility. If you would invest 1,579 in Aqr Long Short Equity on September 3, 2024 and sell it today you would earn a total of 71.00 from holding Aqr Long Short Equity or generate 4.5% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Guggenheim Risk Managed vs. Aqr Long Short Equity
Performance |
| Timeline |
| Guggenheim Risk Managed |
| Aqr Long Short |
Guggenheim Risk and Aqr Long Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Guggenheim Risk and Aqr Long
The main advantage of trading using opposite Guggenheim Risk and Aqr Long positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Guggenheim Risk position performs unexpectedly, Aqr Long 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 Long will offset losses from the drop in Aqr Long's long position.| Guggenheim Risk vs. Guggenheim Risk Managed | Guggenheim Risk vs. Guggenheim Risk Managed | Guggenheim Risk vs. Guggenheim Risk Managed | Guggenheim Risk vs. Lazard Global Listed |
| Aqr Long vs. T Rowe Price | Aqr Long vs. Vanguard California Long Term | Aqr Long vs. Transamerica Funds | Aqr Long vs. Nuveen Minnesota Municipal |
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 Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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