Correlation Between Aqr Sustainable and Ashmore Emerging
Can any of the company-specific risk be diversified away by investing in both Aqr Sustainable and Ashmore Emerging 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 Sustainable and Ashmore Emerging into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Aqr Sustainable Long Short and Ashmore Emerging Markets, you can compare the effects of market volatilities on Aqr Sustainable and Ashmore Emerging 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 Sustainable with a short position of Ashmore Emerging. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aqr Sustainable and Ashmore Emerging.
Diversification Opportunities for Aqr Sustainable and Ashmore Emerging
-0.4 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Aqr and Ashmore is -0.4. Overlapping area represents the amount of risk that can be diversified away by holding Aqr Sustainable Long Short and Ashmore Emerging Markets in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ashmore Emerging Markets and Aqr Sustainable 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 Sustainable Long Short are associated (or correlated) with Ashmore Emerging. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ashmore Emerging Markets has no effect on the direction of Aqr Sustainable i.e., Aqr Sustainable and Ashmore Emerging go up and down completely randomly.
Pair Corralation between Aqr Sustainable and Ashmore Emerging
Assuming the 90 days horizon Aqr Sustainable Long Short is expected to generate 0.56 times more return on investment than Ashmore Emerging. However, Aqr Sustainable Long Short is 1.8 times less risky than Ashmore Emerging. It trades about 0.15 of its potential returns per unit of risk. Ashmore Emerging Markets is currently generating about -0.09 per unit of risk. If you would invest 1,324 in Aqr Sustainable Long Short on October 22, 2024 and sell it today you would earn a total of 18.00 from holding Aqr Sustainable Long Short or generate 1.36% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Aqr Sustainable Long Short vs. Ashmore Emerging Markets
Performance |
| Timeline |
| Aqr Sustainable Long |
| Ashmore Emerging Markets |
Aqr Sustainable and Ashmore Emerging Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aqr Sustainable and Ashmore Emerging
The main advantage of trading using opposite Aqr Sustainable and Ashmore Emerging positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aqr Sustainable position performs unexpectedly, Ashmore Emerging 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 Ashmore Emerging will offset losses from the drop in Ashmore Emerging's long position.| Aqr Sustainable vs. Lord Abbett Short | Aqr Sustainable vs. Msift High Yield | Aqr Sustainable vs. Pace High Yield | Aqr Sustainable vs. City National Rochdale |
| Ashmore Emerging vs. Artisan Small Cap | Ashmore Emerging vs. Franklin Small Cap | Ashmore Emerging vs. Ab Small Cap | Ashmore Emerging vs. Sp Smallcap 600 |
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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
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