Correlation Between Needham Aggressive and Aqr Risk-balanced
Can any of the company-specific risk be diversified away by investing in both Needham Aggressive and Aqr Risk-balanced 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 Needham Aggressive and Aqr Risk-balanced into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Needham Aggressive Growth and Aqr Risk Balanced Modities, you can compare the effects of market volatilities on Needham Aggressive and Aqr Risk-balanced 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 Needham Aggressive with a short position of Aqr Risk-balanced. Check out your portfolio center. Please also check ongoing floating volatility patterns of Needham Aggressive and Aqr Risk-balanced.
Diversification Opportunities for Needham Aggressive and Aqr Risk-balanced
0.49 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Needham and AQR is 0.49. Overlapping area represents the amount of risk that can be diversified away by holding Needham Aggressive Growth and Aqr Risk Balanced Modities in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aqr Risk Balanced and Needham Aggressive 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 Needham Aggressive Growth are associated (or correlated) with Aqr Risk-balanced. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aqr Risk Balanced has no effect on the direction of Needham Aggressive i.e., Needham Aggressive and Aqr Risk-balanced go up and down completely randomly.
Pair Corralation between Needham Aggressive and Aqr Risk-balanced
Assuming the 90 days horizon Needham Aggressive Growth is expected to generate 1.94 times more return on investment than Aqr Risk-balanced. However, Needham Aggressive is 1.94 times more volatile than Aqr Risk Balanced Modities. It trades about 0.16 of its potential returns per unit of risk. Aqr Risk Balanced Modities is currently generating about -0.04 per unit of risk. If you would invest 4,779 in Needham Aggressive Growth on August 31, 2024 and sell it today you would earn a total of 284.00 from holding Needham Aggressive Growth or generate 5.94% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Needham Aggressive Growth vs. Aqr Risk Balanced Modities
Performance |
| Timeline |
| Needham Aggressive Growth |
| Aqr Risk Balanced |
Needham Aggressive and Aqr Risk-balanced Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Needham Aggressive and Aqr Risk-balanced
The main advantage of trading using opposite Needham Aggressive and Aqr Risk-balanced positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Needham Aggressive position performs unexpectedly, Aqr Risk-balanced 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 Risk-balanced will offset losses from the drop in Aqr Risk-balanced's long position.| Needham Aggressive vs. The Hartford Midcap | Needham Aggressive vs. Mfs Emerging Markets | Needham Aggressive vs. Wells Fargo Special | Needham Aggressive vs. Baron Emerging Markets |
| Aqr Risk-balanced vs. Commodityrealreturn Strategy Fund | Aqr Risk-balanced vs. Commodityrealreturn Strategy Fund | Aqr Risk-balanced vs. HUMANA INC | Aqr Risk-balanced vs. Aquagold International |
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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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