Correlation Between Aqr Long-short and 1ws Credit
Can any of the company-specific risk be diversified away by investing in both Aqr Long-short and 1ws Credit 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 Long-short and 1ws Credit into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Aqr Long Short Equity and 1ws Credit Income, you can compare the effects of market volatilities on Aqr Long-short and 1ws Credit 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 Long-short with a short position of 1ws Credit. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aqr Long-short and 1ws Credit.
Diversification Opportunities for Aqr Long-short and 1ws Credit
0.91 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between AQR and 1ws is 0.91. Overlapping area represents the amount of risk that can be diversified away by holding Aqr Long Short Equity and 1ws Credit Income in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on 1ws Credit Income and Aqr Long-short 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 Long Short Equity are associated (or correlated) with 1ws Credit. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of 1ws Credit Income has no effect on the direction of Aqr Long-short i.e., Aqr Long-short and 1ws Credit go up and down completely randomly.
Pair Corralation between Aqr Long-short and 1ws Credit
Assuming the 90 days horizon Aqr Long Short Equity is expected to generate 1.45 times more return on investment than 1ws Credit. However, Aqr Long-short is 1.45 times more volatile than 1ws Credit Income. It trades about 0.25 of its potential returns per unit of risk. 1ws Credit Income is currently generating about 0.09 per unit of risk. If you would invest 1,550 in Aqr Long Short Equity on December 18, 2024 and sell it today you would earn a total of 128.00 from holding Aqr Long Short Equity or generate 8.26% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Very Strong |
Accuracy | 100.0% |
Values | Daily Returns |
Aqr Long Short Equity vs. 1ws Credit Income
Performance |
Timeline |
Aqr Long Short |
1ws Credit Income |
Aqr Long-short and 1ws Credit Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Aqr Long-short and 1ws Credit
The main advantage of trading using opposite Aqr Long-short and 1ws Credit positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aqr Long-short position performs unexpectedly, 1ws Credit 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 1ws Credit will offset losses from the drop in 1ws Credit's long position.Aqr Long-short vs. Allianzgi Nfj Mid Cap | Aqr Long-short vs. Queens Road Small | Aqr Long-short vs. T Rowe Price | Aqr Long-short vs. Catholic Responsible Investments |
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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.
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