Correlation Between Short Precious and Aqr Managed
Can any of the company-specific risk be diversified away by investing in both Short Precious and Aqr Managed 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 Short Precious and Aqr Managed into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Short Precious Metals and Aqr Managed Futures, you can compare the effects of market volatilities on Short Precious and Aqr Managed 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 Short Precious with a short position of Aqr Managed. Check out your portfolio center. Please also check ongoing floating volatility patterns of Short Precious and Aqr Managed.
Diversification Opportunities for Short Precious and Aqr Managed
0.69 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Short and Aqr is 0.69. Overlapping area represents the amount of risk that can be diversified away by holding Short Precious Metals and Aqr Managed Futures in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aqr Managed Futures and Short Precious 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 Short Precious Metals are associated (or correlated) with Aqr Managed. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aqr Managed Futures has no effect on the direction of Short Precious i.e., Short Precious and Aqr Managed go up and down completely randomly.
Pair Corralation between Short Precious and Aqr Managed
Assuming the 90 days horizon Short Precious Metals is expected to generate 3.13 times more return on investment than Aqr Managed. However, Short Precious is 3.13 times more volatile than Aqr Managed Futures. It trades about 0.12 of its potential returns per unit of risk. Aqr Managed Futures is currently generating about 0.2 per unit of risk. If you would invest 942.00 in Short Precious Metals on October 12, 2024 and sell it today you would earn a total of 45.00 from holding Short Precious Metals or generate 4.78% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Short Precious Metals vs. Aqr Managed Futures
Performance |
| Timeline |
| Short Precious Metals |
| Aqr Managed Futures |
Short Precious and Aqr Managed Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Short Precious and Aqr Managed
The main advantage of trading using opposite Short Precious and Aqr Managed positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Short Precious position performs unexpectedly, Aqr Managed 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 Aqr Managed will offset losses from the drop in Aqr Managed's long position.| Short Precious vs. Angel Oak Multi Strategy | Short Precious vs. Inverse Nasdaq 100 Strategy | Short Precious vs. Oberweis Emerging Growth | Short Precious vs. Eagle Mlp Strategy |
| Aqr Managed vs. Short Precious Metals | Aqr Managed vs. The Gold Bullion | Aqr Managed vs. Invesco Gold Special | Aqr Managed vs. Fidelity Advisor Gold |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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