Correlation Between Aqr Managed and Federated Kaufmann
Can any of the company-specific risk be diversified away by investing in both Aqr Managed and Federated Kaufmann 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 Managed and Federated Kaufmann into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Aqr Managed Futures and Federated Kaufmann Fund, you can compare the effects of market volatilities on Aqr Managed and Federated Kaufmann 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 Managed with a short position of Federated Kaufmann. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aqr Managed and Federated Kaufmann.
Diversification Opportunities for Aqr Managed and Federated Kaufmann
0.5 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Aqr and Federated is 0.5. Overlapping area represents the amount of risk that can be diversified away by holding Aqr Managed Futures and Federated Kaufmann Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Federated Kaufmann and Aqr Managed 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 Managed Futures are associated (or correlated) with Federated Kaufmann. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Federated Kaufmann has no effect on the direction of Aqr Managed i.e., Aqr Managed and Federated Kaufmann go up and down completely randomly.
Pair Corralation between Aqr Managed and Federated Kaufmann
Assuming the 90 days horizon Aqr Managed is expected to generate 2.67 times less return on investment than Federated Kaufmann. But when comparing it to its historical volatility, Aqr Managed Futures is 1.02 times less risky than Federated Kaufmann. It trades about 0.02 of its potential returns per unit of risk. Federated Kaufmann Fund is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 347.00 in Federated Kaufmann Fund on September 4, 2024 and sell it today you would earn a total of 113.00 from holding Federated Kaufmann Fund or generate 32.56% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 99.8% |
| Values | Daily Returns |
Aqr Managed Futures vs. Federated Kaufmann Fund
Performance |
| Timeline |
| Aqr Managed Futures |
| Federated Kaufmann |
Aqr Managed and Federated Kaufmann Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aqr Managed and Federated Kaufmann
The main advantage of trading using opposite Aqr Managed and Federated Kaufmann positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aqr Managed position performs unexpectedly, Federated Kaufmann 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 Kaufmann will offset losses from the drop in Federated Kaufmann's long position.| Aqr Managed vs. T Rowe Price | Aqr Managed vs. Falcon Focus Scv | Aqr Managed vs. Iaadx | Aqr Managed vs. Leggmason Partners Institutional |
| Federated Kaufmann vs. T Rowe Price | Federated Kaufmann vs. Artisan Thematic Fund | Federated Kaufmann vs. Issachar Fund Class | Federated Kaufmann vs. T Rowe Price |
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 Anywhere module to track or share privately all of your investments from the convenience of any device.
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