Correlation Between Locorr Long/short and Aqr Managed
Can any of the company-specific risk be diversified away by investing in both Locorr Long/short and Aqr Managed 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 Locorr Long/short and Aqr Managed into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Locorr Longshort Modities and Aqr Managed Futures, you can compare the effects of market volatilities on Locorr Long/short and Aqr Managed 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 Locorr Long/short with a short position of Aqr Managed. Check out your portfolio center. Please also check ongoing floating volatility patterns of Locorr Long/short and Aqr Managed.
Diversification Opportunities for Locorr Long/short and Aqr Managed
-0.11 | Correlation Coefficient |
Good diversification
The 3 months correlation between Locorr and Aqr is -0.11. Overlapping area represents the amount of risk that can be diversified away by holding Locorr Longshort Modities and Aqr Managed Futures in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aqr Managed Futures and Locorr Long/short 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 Locorr Longshort Modities are associated (or correlated) with Aqr Managed. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aqr Managed Futures has no effect on the direction of Locorr Long/short i.e., Locorr Long/short and Aqr Managed go up and down completely randomly.
Pair Corralation between Locorr Long/short and Aqr Managed
Assuming the 90 days horizon Locorr Longshort Modities is expected to under-perform the Aqr Managed. But the mutual fund apears to be less risky and, when comparing its historical volatility, Locorr Longshort Modities is 2.24 times less risky than Aqr Managed. The mutual fund trades about -0.14 of its potential returns per unit of risk. The Aqr Managed Futures is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 846.00 in Aqr Managed Futures on August 31, 2024 and sell it today you would earn a total of 10.00 from holding Aqr Managed Futures or generate 1.18% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Locorr Longshort Modities vs. Aqr Managed Futures
Performance |
| Timeline |
| Locorr Longshort Modities |
| Aqr Managed Futures |
Locorr Long/short and Aqr Managed Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Locorr Long/short and Aqr Managed
The main advantage of trading using opposite Locorr Long/short and Aqr Managed positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Locorr Long/short position performs unexpectedly, Aqr Managed 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 Managed will offset losses from the drop in Aqr Managed's long position.| Locorr Long/short vs. Aqr Managed Futures | Locorr Long/short vs. Pimco Trends Managed | Locorr Long/short vs. Pimco Trends Managed | Locorr Long/short vs. American Beacon Ahl |
| Aqr Managed vs. Barings Active Short | Aqr Managed vs. Angel Oak Ultrashort | Aqr Managed vs. Federated Ultrashort Bond | Aqr Managed vs. Short Intermediate Bond Fund |
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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
Other Complementary Tools
| Fundamentals Comparison Compare fundamentals across multiple equities to find investing opportunities | |
| Bond Analysis Evaluate and analyze corporate bonds as a potential investment for your portfolios. | |
| Commodity Directory Find actively traded commodities issued by global exchanges | |
| Economic Indicators Top statistical indicators that provide insights into how an economy is performing | |
| Commodity Channel Use Commodity Channel Index to analyze current equity momentum |