Correlation Between Aqr Small and Growth Fund
Can any of the company-specific risk be diversified away by investing in both Aqr Small and Growth Fund 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 Small and Growth Fund into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Aqr Small Cap and Growth Fund Of, you can compare the effects of market volatilities on Aqr Small and Growth Fund 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 Small with a short position of Growth Fund. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aqr Small and Growth Fund.
Diversification Opportunities for Aqr Small and Growth Fund
0.93 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Aqr and Growth is 0.93. Overlapping area represents the amount of risk that can be diversified away by holding Aqr Small Cap and Growth Fund Of in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Growth Fund and Aqr Small 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 Small Cap are associated (or correlated) with Growth Fund. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Growth Fund has no effect on the direction of Aqr Small i.e., Aqr Small and Growth Fund go up and down completely randomly.
Pair Corralation between Aqr Small and Growth Fund
Assuming the 90 days horizon Aqr Small Cap is expected to under-perform the Growth Fund. In addition to that, Aqr Small is 1.46 times more volatile than Growth Fund Of. It trades about -0.1 of its total potential returns per unit of risk. Growth Fund Of is currently generating about 0.09 per unit of volatility. If you would invest 8,090 in Growth Fund Of on September 12, 2024 and sell it today you would earn a total of 100.00 from holding Growth Fund Of or generate 1.24% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Aqr Small Cap vs. Growth Fund Of
Performance |
| Timeline |
| Aqr Small Cap |
| Growth Fund |
Aqr Small and Growth Fund Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aqr Small and Growth Fund
The main advantage of trading using opposite Aqr Small and Growth Fund positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aqr Small position performs unexpectedly, Growth Fund 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 Growth Fund will offset losses from the drop in Growth Fund's long position.| Aqr Small vs. Dunham Large Cap | Aqr Small vs. Jhancock Disciplined Value | Aqr Small vs. Fidelity Series 1000 | Aqr Small vs. Dana Large Cap |
| Growth Fund vs. Aqr Small Cap | Growth Fund vs. Old Westbury Small | Growth Fund vs. Kinetics Small Cap | Growth Fund vs. Touchstone Small Cap |
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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
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