Correlation Between Aqr Style and Guggenheim High
Can any of the company-specific risk be diversified away by investing in both Aqr Style and Guggenheim High 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 Style and Guggenheim High into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Aqr Style Premia and Guggenheim High Yield, you can compare the effects of market volatilities on Aqr Style and Guggenheim High 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 Style with a short position of Guggenheim High. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aqr Style and Guggenheim High.
Diversification Opportunities for Aqr Style and Guggenheim High
0.01 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Aqr and GUGGENHEIM is 0.01. Overlapping area represents the amount of risk that can be diversified away by holding Aqr Style Premia and Guggenheim High Yield in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guggenheim High Yield and Aqr Style 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 Style Premia are associated (or correlated) with Guggenheim High. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guggenheim High Yield has no effect on the direction of Aqr Style i.e., Aqr Style and Guggenheim High go up and down completely randomly.
Pair Corralation between Aqr Style and Guggenheim High
Assuming the 90 days horizon Aqr Style is expected to generate 1.04 times less return on investment than Guggenheim High. In addition to that, Aqr Style is 3.67 times more volatile than Guggenheim High Yield. It trades about 0.04 of its total potential returns per unit of risk. Guggenheim High Yield is currently generating about 0.15 per unit of volatility. If you would invest 1,007 in Guggenheim High Yield on September 4, 2024 and sell it today you would earn a total of 4.00 from holding Guggenheim High Yield or generate 0.4% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 95.24% |
| Values | Daily Returns |
Aqr Style Premia vs. Guggenheim High Yield
Performance |
| Timeline |
| Aqr Style Premia |
| Guggenheim High Yield |
Aqr Style and Guggenheim High Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aqr Style and Guggenheim High
The main advantage of trading using opposite Aqr Style and Guggenheim High positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aqr Style position performs unexpectedly, Guggenheim High 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 Guggenheim High will offset losses from the drop in Guggenheim High's long position.| Aqr Style vs. Guggenheim High Yield | Aqr Style vs. T Rowe Price | Aqr Style vs. Gmo High Yield | Aqr Style vs. Virtus High Yield |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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