Correlation Between Asg Managed and Aqr Equity

Can any of the company-specific risk be diversified away by investing in both Asg Managed and Aqr Equity 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 Asg Managed and Aqr Equity into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Asg Managed Futures and Aqr Equity Market, you can compare the effects of market volatilities on Asg Managed and Aqr Equity 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 Asg Managed with a short position of Aqr Equity. Check out your portfolio center. Please also check ongoing floating volatility patterns of Asg Managed and Aqr Equity.

Diversification Opportunities for Asg Managed and Aqr Equity

0.38

Correlation Coefficient

Asg Managed  Aqr Equity

Weak diversification

The 3 months correlation between Asg and Aqr is 0.38. Overlapping area represents the amount of risk that can be diversified away by holding Asg Managed Futures and Aqr Equity Market in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aqr Equity Market and Asg Managed 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 Asg Managed Futures are associated (or correlated) with Aqr Equity. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aqr Equity Market has no effect on the direction of Asg Managed i.e., Asg Managed and Aqr Equity go up and down completely randomly.

Pair Corralation between Asg Managed and Aqr Equity

Assuming the 90 days horizon Asg Managed Futures is expected to generate 0.43 times more return on investment than Aqr Equity. However, Asg Managed Futures is 2.31 times less risky than Aqr Equity. It trades about -0.04 of its potential returns per unit of risk. Aqr Equity Market is currently generating about -0.11 per unit of risk. If you would invest  875.00  in Asg Managed Futures on October 9, 2024 and sell it today you would lose (5.00) from holding Asg Managed Futures or give up 0.57% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	100.0%
Values	Daily Returns

Asg Managed Futures  vs.  Aqr Equity Market

Asg Managed Futures

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Asg Managed Futures has generated negative risk-adjusted returns adding no value to fund investors. In spite of fairly strong basic indicators, Asg Managed is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Aqr Equity Market

Risk-Adjusted Performance

2 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Aqr Equity Market are ranked lower than 2 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong forward indicators, Aqr Equity is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Asg Managed and Aqr Equity

The main advantage of trading using opposite Asg Managed and Aqr Equity positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Asg Managed position performs unexpectedly, Aqr Equity 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 Equity will offset losses from the drop in Aqr Equity's long position.

The idea behind Asg Managed Futures and Aqr Equity Market pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.