Correlation Between Aqr Managed and Municipal Bond
Can any of the company-specific risk be diversified away by investing in both Aqr Managed and Municipal Bond 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 Managed and Municipal Bond into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Aqr Managed Futures and Municipal Bond Fund, you can compare the effects of market volatilities on Aqr Managed and Municipal Bond 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 Managed with a short position of Municipal Bond. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aqr Managed and Municipal Bond.
Diversification Opportunities for Aqr Managed and Municipal Bond
0.56 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Aqr and Municipal is 0.56. Overlapping area represents the amount of risk that can be diversified away by holding Aqr Managed Futures and Municipal Bond Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Municipal Bond and Aqr 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 Aqr Managed Futures are associated (or correlated) with Municipal Bond. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Municipal Bond has no effect on the direction of Aqr Managed i.e., Aqr Managed and Municipal Bond go up and down completely randomly.
Pair Corralation between Aqr Managed and Municipal Bond
Assuming the 90 days horizon Aqr Managed Futures is expected to generate 2.81 times more return on investment than Municipal Bond. However, Aqr Managed is 2.81 times more volatile than Municipal Bond Fund. It trades about 0.06 of its potential returns per unit of risk. Municipal Bond Fund is currently generating about -0.02 per unit of risk. If you would invest 820.00 in Aqr Managed Futures on September 14, 2024 and sell it today you would earn a total of 24.00 from holding Aqr Managed Futures or generate 2.93% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Weak |
Accuracy | 98.44% |
Values | Daily Returns |
Aqr Managed Futures vs. Municipal Bond Fund
Performance |
Timeline |
Aqr Managed Futures |
Municipal Bond |
Aqr Managed and Municipal Bond Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Aqr Managed and Municipal Bond
The main advantage of trading using opposite Aqr Managed and Municipal Bond positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aqr Managed position performs unexpectedly, Municipal Bond 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 Municipal Bond will offset losses from the drop in Municipal Bond's long position.Aqr Managed vs. Siit Global Managed | Aqr Managed vs. Alliancebernstein Global High | Aqr Managed vs. Scharf Global Opportunity | Aqr Managed vs. Kinetics Global Fund |
Municipal Bond vs. Aqr Managed Futures | Municipal Bond vs. Ab Bond Inflation | Municipal Bond vs. Arrow Managed Futures | Municipal Bond vs. Blackrock Inflation Protected |
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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