Correlation Between Hunter Small and Baillie Gifford
Can any of the company-specific risk be diversified away by investing in both Hunter Small 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 Hunter Small and Baillie Gifford into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hunter Small Cap and Baillie Gifford Global, you can compare the effects of market volatilities on Hunter Small 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 Hunter Small with a short position of Baillie Gifford. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hunter Small and Baillie Gifford.
Diversification Opportunities for Hunter Small and Baillie Gifford
0.04 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Hunter and Baillie is 0.04. Overlapping area represents the amount of risk that can be diversified away by holding Hunter Small Cap and Baillie Gifford Global in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Baillie Gifford Global and Hunter Small 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 Hunter Small Cap 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 Global has no effect on the direction of Hunter Small i.e., Hunter Small and Baillie Gifford go up and down completely randomly.
Pair Corralation between Hunter Small and Baillie Gifford
Assuming the 90 days horizon Hunter Small Cap is expected to generate 1.6 times more return on investment than Baillie Gifford. However, Hunter Small is 1.6 times more volatile than Baillie Gifford Global. It trades about 0.06 of its potential returns per unit of risk. Baillie Gifford Global is currently generating about 0.04 per unit of risk. If you would invest 1,103 in Hunter Small Cap on November 3, 2024 and sell it today you would earn a total of 171.00 from holding Hunter Small Cap or generate 15.5% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 38.87% |
| Values | Daily Returns |
Hunter Small Cap vs. Baillie Gifford Global
Performance |
| Timeline |
| Hunter Small Cap |
| Baillie Gifford Global |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Hunter Small and Baillie Gifford Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hunter Small and Baillie Gifford
The main advantage of trading using opposite Hunter Small and Baillie Gifford positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hunter Small 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.| Hunter Small vs. James Alpha Structured | Hunter Small vs. Calamos Antetokounmpo Sustainable | Hunter Small vs. Ultra Short Fixed Income | Hunter Small vs. Vanguard Wellington Fund |
| Baillie Gifford vs. Calvert Conservative Allocation | Baillie Gifford vs. Tiaa Cref Lifestyle Conservative | Baillie Gifford vs. Diversified Income Fund | Baillie Gifford vs. Fulcrum Diversified Absolute |
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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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