Correlation Between Aqr Diversified and Mirova Global
Can any of the company-specific risk be diversified away by investing in both Aqr Diversified and Mirova Global 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 Aqr Diversified and Mirova Global into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Aqr Diversified Arbitrage and Mirova Global Green, you can compare the effects of market volatilities on Aqr Diversified and Mirova Global 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 Aqr Diversified with a short position of Mirova Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aqr Diversified and Mirova Global.
Diversification Opportunities for Aqr Diversified and Mirova Global
-0.24 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Aqr and Mirova is -0.24. Overlapping area represents the amount of risk that can be diversified away by holding Aqr Diversified Arbitrage and Mirova Global Green in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mirova Global Green and Aqr Diversified 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 Aqr Diversified Arbitrage are associated (or correlated) with Mirova Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mirova Global Green has no effect on the direction of Aqr Diversified i.e., Aqr Diversified and Mirova Global go up and down completely randomly.
Pair Corralation between Aqr Diversified and Mirova Global
Assuming the 90 days horizon Aqr Diversified Arbitrage is expected to generate 0.54 times more return on investment than Mirova Global. However, Aqr Diversified Arbitrage is 1.85 times less risky than Mirova Global. It trades about -0.17 of its potential returns per unit of risk. Mirova Global Green is currently generating about -0.21 per unit of risk. If you would invest 1,220 in Aqr Diversified Arbitrage on September 26, 2024 and sell it today you would lose (14.00) from holding Aqr Diversified Arbitrage or give up 1.15% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Aqr Diversified Arbitrage vs. Mirova Global Green
Performance |
| Timeline |
| Aqr Diversified Arbitrage |
| Mirova Global Green |
Aqr Diversified and Mirova Global Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aqr Diversified and Mirova Global
The main advantage of trading using opposite Aqr Diversified and Mirova Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aqr Diversified position performs unexpectedly, Mirova Global 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 Mirova Global will offset losses from the drop in Mirova Global's long position.| Aqr Diversified vs. Aqr Large Cap | Aqr Diversified vs. Aqr Large Cap | Aqr Diversified vs. Aqr International Defensive | Aqr Diversified vs. Aqr International Defensive |
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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 Portfolio File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
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