Correlation Between Aqr Long-short and Pgim Esg
Can any of the company-specific risk be diversified away by investing in both Aqr Long-short and Pgim Esg 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 Long-short and Pgim Esg into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Aqr Long Short Equity and Pgim Esg Short, you can compare the effects of market volatilities on Aqr Long-short and Pgim Esg 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 Long-short with a short position of Pgim Esg. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aqr Long-short and Pgim Esg.
Diversification Opportunities for Aqr Long-short and Pgim Esg
0.79 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Aqr and Pgim is 0.79. Overlapping area represents the amount of risk that can be diversified away by holding Aqr Long Short Equity and Pgim Esg Short in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pgim Esg Short and Aqr Long-short 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 Long Short Equity are associated (or correlated) with Pgim Esg. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pgim Esg Short has no effect on the direction of Aqr Long-short i.e., Aqr Long-short and Pgim Esg go up and down completely randomly.
Pair Corralation between Aqr Long-short and Pgim Esg
Assuming the 90 days horizon Aqr Long Short Equity is expected to generate 3.19 times more return on investment than Pgim Esg. However, Aqr Long-short is 3.19 times more volatile than Pgim Esg Short. It trades about 0.19 of its potential returns per unit of risk. Pgim Esg Short is currently generating about 0.14 per unit of risk. If you would invest 1,004 in Aqr Long Short Equity on October 23, 2024 and sell it today you would earn a total of 594.00 from holding Aqr Long Short Equity or generate 59.16% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Aqr Long Short Equity vs. Pgim Esg Short
Performance |
| Timeline |
| Aqr Long Short |
| Pgim Esg Short |
Aqr Long-short and Pgim Esg Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aqr Long-short and Pgim Esg
The main advantage of trading using opposite Aqr Long-short and Pgim Esg positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aqr Long-short position performs unexpectedly, Pgim Esg 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 Pgim Esg will offset losses from the drop in Pgim Esg's long position.| Aqr Long-short vs. Sierra E Retirement | Aqr Long-short vs. Qs Moderate Growth | Aqr Long-short vs. Moderately Aggressive Balanced | Aqr Long-short vs. Voya Target Retirement |
| Pgim Esg vs. Aqr Long Short Equity | Pgim Esg vs. Siit Equity Factor | Pgim Esg vs. Dreyfusstandish Global Fixed | Pgim Esg vs. Gmo Global Equity |
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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
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