Correlation Between Mairs Power and Aqr Managed
Can any of the company-specific risk be diversified away by investing in both Mairs Power 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 Mairs Power and Aqr Managed into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Mairs Power Growth and Aqr Managed Futures, you can compare the effects of market volatilities on Mairs Power 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 Mairs Power with a short position of Aqr Managed. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mairs Power and Aqr Managed.
Diversification Opportunities for Mairs Power and Aqr Managed
-0.02 | Correlation Coefficient |
Good diversification
The 3 months correlation between Mairs and Aqr is -0.02. Overlapping area represents the amount of risk that can be diversified away by holding Mairs Power Growth 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 Mairs Power 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 Mairs Power Growth 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 Mairs Power i.e., Mairs Power and Aqr Managed go up and down completely randomly.
Pair Corralation between Mairs Power and Aqr Managed
Assuming the 90 days horizon Mairs Power Growth is expected to under-perform the Aqr Managed. In addition to that, Mairs Power is 1.25 times more volatile than Aqr Managed Futures. It trades about -0.28 of its total potential returns per unit of risk. Aqr Managed Futures is currently generating about 0.05 per unit of volatility. If you would invest 837.00 in Aqr Managed Futures on October 10, 2024 and sell it today you would earn a total of 7.00 from holding Aqr Managed Futures or generate 0.84% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Mairs Power Growth vs. Aqr Managed Futures
Performance |
| Timeline |
| Mairs Power Growth |
| Aqr Managed Futures |
Mairs Power and Aqr Managed Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Mairs Power and Aqr Managed
The main advantage of trading using opposite Mairs Power and Aqr Managed positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mairs Power 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.| Mairs Power vs. Meridian Trarian Fund | Mairs Power vs. Mairs Power Balanced | Mairs Power vs. Clipper Fund Inc | Mairs Power vs. Meridian Growth Fund |
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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 CEOs Directory module to screen CEOs from public companies around the world.
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