Correlation Between Aqr Global and Federated Hermes
Can any of the company-specific risk be diversified away by investing in both Aqr Global and Federated Hermes 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 Global and Federated Hermes into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Aqr Global Macro and Federated Hermes Conservative, you can compare the effects of market volatilities on Aqr Global and Federated Hermes 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 Global with a short position of Federated Hermes. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aqr Global and Federated Hermes.
Diversification Opportunities for Aqr Global and Federated Hermes
0.94 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Aqr and Federated is 0.94. Overlapping area represents the amount of risk that can be diversified away by holding Aqr Global Macro and Federated Hermes Conservative in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Federated Hermes Con and Aqr Global 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 Global Macro are associated (or correlated) with Federated Hermes. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Federated Hermes Con has no effect on the direction of Aqr Global i.e., Aqr Global and Federated Hermes go up and down completely randomly.
Pair Corralation between Aqr Global and Federated Hermes
Assuming the 90 days horizon Aqr Global is expected to generate 4.69 times less return on investment than Federated Hermes. In addition to that, Aqr Global is 5.08 times more volatile than Federated Hermes Conservative. It trades about 0.01 of its total potential returns per unit of risk. Federated Hermes Conservative is currently generating about 0.25 per unit of volatility. If you would invest 937.00 in Federated Hermes Conservative on November 3, 2024 and sell it today you would earn a total of 65.00 from holding Federated Hermes Conservative or generate 6.94% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Aqr Global Macro vs. Federated Hermes Conservative
Performance |
| Timeline |
| Aqr Global Macro |
| Federated Hermes Con |
Aqr Global and Federated Hermes Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aqr Global and Federated Hermes
The main advantage of trading using opposite Aqr Global and Federated Hermes positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aqr Global position performs unexpectedly, Federated Hermes 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 Federated Hermes will offset losses from the drop in Federated Hermes' long position.| Aqr Global vs. Western Assets Emerging | Aqr Global vs. Angel Oak Multi Strategy | Aqr Global vs. Nasdaq 100 2x Strategy | Aqr Global vs. Doubleline Emerging Markets |
| Federated Hermes vs. Neuberger Berman Real | Federated Hermes vs. Columbia Real Estate | Federated Hermes vs. Dunham Real Estate | Federated Hermes vs. Fidelity Real Estate |
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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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