Correlation Between Aqr Sustainable and Templeton Growth
Can any of the company-specific risk be diversified away by investing in both Aqr Sustainable and Templeton Growth 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 Templeton Growth 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 Templeton Growth Fund, you can compare the effects of market volatilities on Aqr Sustainable and Templeton Growth 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 Templeton Growth. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aqr Sustainable and Templeton Growth.
Diversification Opportunities for Aqr Sustainable and Templeton Growth
-0.34 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Aqr and Templeton is -0.34. Overlapping area represents the amount of risk that can be diversified away by holding Aqr Sustainable Long Short and Templeton Growth Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Templeton Growth 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 Templeton Growth. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Templeton Growth has no effect on the direction of Aqr Sustainable i.e., Aqr Sustainable and Templeton Growth go up and down completely randomly.
Pair Corralation between Aqr Sustainable and Templeton Growth
Assuming the 90 days horizon Aqr Sustainable is expected to generate 1.71 times less return on investment than Templeton Growth. In addition to that, Aqr Sustainable is 1.16 times more volatile than Templeton Growth Fund. It trades about 0.11 of its total potential returns per unit of risk. Templeton Growth Fund is currently generating about 0.21 per unit of volatility. If you would invest 2,657 in Templeton Growth Fund on November 8, 2024 and sell it today you would earn a total of 85.00 from holding Templeton Growth Fund or generate 3.2% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.24% |
| Values | Daily Returns |
Aqr Sustainable Long Short vs. Templeton Growth Fund
Performance |
| Timeline |
| Aqr Sustainable Long |
| Templeton Growth |
Aqr Sustainable and Templeton Growth Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aqr Sustainable and Templeton Growth
The main advantage of trading using opposite Aqr Sustainable and Templeton Growth positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aqr Sustainable position performs unexpectedly, Templeton Growth 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 Templeton Growth will offset losses from the drop in Templeton Growth's long position.| Aqr Sustainable vs. Aqr Large Cap | Aqr Sustainable vs. Aqr Large Cap | Aqr Sustainable vs. Aqr International Defensive | Aqr Sustainable vs. Aqr International Defensive |
| Templeton Growth vs. Virtus Convertible | Templeton Growth vs. Lord Abbett Convertible | Templeton Growth vs. Fidelity Sai Convertible | Templeton Growth vs. Allianzgi Convertible Income |
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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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