Correlation Between High Yield and Aqr Large
Can any of the company-specific risk be diversified away by investing in both High Yield and Aqr Large 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 High Yield and Aqr Large into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between High Yield Portfolio and Aqr Large Cap, you can compare the effects of market volatilities on High Yield and Aqr Large 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 High Yield with a short position of Aqr Large. Check out your portfolio center. Please also check ongoing floating volatility patterns of High Yield and Aqr Large.
Diversification Opportunities for High Yield and Aqr Large
0.15 | Correlation Coefficient |
Average diversification
The 3 months correlation between High and Aqr is 0.15. Overlapping area represents the amount of risk that can be diversified away by holding High Yield Portfolio and Aqr Large Cap in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aqr Large Cap and High Yield 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 High Yield Portfolio are associated (or correlated) with Aqr Large. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aqr Large Cap has no effect on the direction of High Yield i.e., High Yield and Aqr Large go up and down completely randomly.
Pair Corralation between High Yield and Aqr Large
Assuming the 90 days horizon High Yield is expected to generate 3.15 times less return on investment than Aqr Large. But when comparing it to its historical volatility, High Yield Portfolio is 6.12 times less risky than Aqr Large. It trades about 0.28 of its potential returns per unit of risk. Aqr Large Cap is currently generating about 0.15 of returns per unit of risk over similar time horizon. If you would invest 2,201 in Aqr Large Cap on October 23, 2024 and sell it today you would earn a total of 56.00 from holding Aqr Large Cap or generate 2.54% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
High Yield Portfolio vs. Aqr Large Cap
Performance |
| Timeline |
| High Yield Portfolio |
| Aqr Large Cap |
High Yield and Aqr Large Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with High Yield and Aqr Large
The main advantage of trading using opposite High Yield and Aqr Large positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if High Yield position performs unexpectedly, Aqr Large 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 Large will offset losses from the drop in Aqr Large's long position.| High Yield vs. Lord Abbett Diversified | High Yield vs. Nasdaq 100 Profund Nasdaq 100 | High Yield vs. T Rowe Price | High Yield vs. Qs Large Cap |
| Aqr Large vs. Ms Global Fixed | Aqr Large vs. Gmo Global Equity | Aqr Large vs. Us Global Investors | Aqr Large vs. Ab Global Bond |
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 Global Correlations module to find global opportunities by holding instruments from different markets.
Other Complementary Tools
| Global Markets Map Get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes | |
| Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk | |
| Balance Of Power Check stock momentum by analyzing Balance Of Power indicator and other technical ratios | |
| Bonds Directory Find actively traded corporate debentures issued by US companies | |
| CEOs Directory Screen CEOs from public companies around the world |