Correlation Between Aqr Sustainable and Alger Global

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

By analyzing existing cross correlation between Aqr Sustainable Long Short and Alger Global Growth, you can compare the effects of market volatilities on Aqr Sustainable and Alger Global 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 Sustainable with a short position of Alger Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aqr Sustainable and Alger Global.

Diversification Opportunities for Aqr Sustainable and Alger Global

-0.62

Correlation Coefficient

Aqr Sustainable  Alger Global

Excellent diversification

The 3 months correlation between Aqr and Alger is -0.62. Overlapping area represents the amount of risk that can be diversified away by holding Aqr Sustainable Long Short and Alger Global Growth in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Alger Global Growth and Aqr Sustainable 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 Sustainable Long Short are associated (or correlated) with Alger Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Alger Global Growth has no effect on the direction of Aqr Sustainable i.e., Aqr Sustainable and Alger Global go up and down completely randomly.

Pair Corralation between Aqr Sustainable and Alger Global

Assuming the 90 days horizon Aqr Sustainable is expected to generate 1.97 times less return on investment than Alger Global. But when comparing it to its historical volatility, Aqr Sustainable Long Short is 1.23 times less risky than Alger Global. It trades about 0.06 of its potential returns per unit of risk. Alger Global Growth is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest  2,843  in Alger Global Growth on October 25, 2024 and sell it today you would earn a total of  34.00  from holding Alger Global Growth or generate 1.2% return on investment over 90 days.

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

Aqr Sustainable Long Short  vs.  Alger Global Growth

Aqr Sustainable Long

Risk-Adjusted Performance

11 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Aqr Sustainable Long Short are ranked lower than 11 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak forward indicators, Aqr Sustainable may actually be approaching a critical reversion point that can send shares even higher in February 2025.

Alger Global Growth

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Alger Global Growth has generated negative risk-adjusted returns adding no value to fund investors. In spite of latest weak performance, the Fund's basic indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the fund investors.

Pair Trading with Aqr Sustainable and Alger Global

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

The idea behind Aqr Sustainable Long Short and Alger Global Growth 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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.