Correlation Between Mesirow Financial and Aqr International
Can any of the company-specific risk be diversified away by investing in both Mesirow Financial and Aqr International 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 Mesirow Financial and Aqr International into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Mesirow Financial Small and Aqr International Momentum, you can compare the effects of market volatilities on Mesirow Financial and Aqr International 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 Mesirow Financial with a short position of Aqr International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mesirow Financial and Aqr International.
Diversification Opportunities for Mesirow Financial and Aqr International
-0.15 | Correlation Coefficient |
Good diversification
The 3 months correlation between Mesirow and Aqr is -0.15. Overlapping area represents the amount of risk that can be diversified away by holding Mesirow Financial Small and Aqr International Momentum in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aqr International and Mesirow Financial 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 Mesirow Financial Small are associated (or correlated) with Aqr International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aqr International has no effect on the direction of Mesirow Financial i.e., Mesirow Financial and Aqr International go up and down completely randomly.
Pair Corralation between Mesirow Financial and Aqr International
Assuming the 90 days horizon Mesirow Financial Small is expected to generate 1.29 times more return on investment than Aqr International. However, Mesirow Financial is 1.29 times more volatile than Aqr International Momentum. It trades about 0.05 of its potential returns per unit of risk. Aqr International Momentum is currently generating about 0.07 per unit of risk. If you would invest 1,091 in Mesirow Financial Small on September 14, 2024 and sell it today you would earn a total of 329.00 from holding Mesirow Financial Small or generate 30.16% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.8% |
| Values | Daily Returns |
Mesirow Financial Small vs. Aqr International Momentum
Performance |
| Timeline |
| Mesirow Financial Small |
| Aqr International |
Mesirow Financial and Aqr International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Mesirow Financial and Aqr International
The main advantage of trading using opposite Mesirow Financial and Aqr International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mesirow Financial position performs unexpectedly, Aqr International 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 International will offset losses from the drop in Aqr International's long position.| Mesirow Financial vs. Lord Abbett Inflation | Mesirow Financial vs. Arrow Managed Futures | Mesirow Financial vs. Fidelity Sai Inflationfocused | Mesirow Financial vs. Short Duration Inflation |
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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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
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