Correlation Between Baillie Gifford and Aberdeen New
Can any of the company-specific risk be diversified away by investing in both Baillie Gifford and Aberdeen New 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 Baillie Gifford and Aberdeen New into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Baillie Gifford Growth and Aberdeen New India, you can compare the effects of market volatilities on Baillie Gifford and Aberdeen New 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 Baillie Gifford with a short position of Aberdeen New. Check out your portfolio center. Please also check ongoing floating volatility patterns of Baillie Gifford and Aberdeen New.
Diversification Opportunities for Baillie Gifford and Aberdeen New
-0.5 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Baillie and Aberdeen is -0.5. Overlapping area represents the amount of risk that can be diversified away by holding Baillie Gifford Growth and Aberdeen New India in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aberdeen New India and Baillie Gifford 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 Baillie Gifford Growth are associated (or correlated) with Aberdeen New. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aberdeen New India has no effect on the direction of Baillie Gifford i.e., Baillie Gifford and Aberdeen New go up and down completely randomly.
Pair Corralation between Baillie Gifford and Aberdeen New
Assuming the 90 days trading horizon Baillie Gifford Growth is expected to generate 2.07 times more return on investment than Aberdeen New. However, Baillie Gifford is 2.07 times more volatile than Aberdeen New India. It trades about 0.49 of its potential returns per unit of risk. Aberdeen New India is currently generating about 0.35 per unit of risk. If you would invest 21,550 in Baillie Gifford Growth on August 29, 2024 and sell it today you would earn a total of 5,400 from holding Baillie Gifford Growth or generate 25.06% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
Baillie Gifford Growth vs. Aberdeen New India
Performance |
| Timeline |
| Baillie Gifford Growth |
| Aberdeen New India |
Baillie Gifford and Aberdeen New Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Baillie Gifford and Aberdeen New
The main advantage of trading using opposite Baillie Gifford and Aberdeen New positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Baillie Gifford position performs unexpectedly, Aberdeen New 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 Aberdeen New will offset losses from the drop in Aberdeen New's long position.| Baillie Gifford vs. iShares MSCI Japan | Baillie Gifford vs. Amundi EUR High | Baillie Gifford vs. iShares JP Morgan | Baillie Gifford vs. Xtrackers MSCI |
| Aberdeen New vs. iShares MSCI Japan | Aberdeen New vs. Amundi EUR High | Aberdeen New vs. iShares JP Morgan | Aberdeen New vs. Xtrackers MSCI |
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 Portfolio Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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