Correlation Between Aqr Large and Doubleline Shiller

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

By analyzing existing cross correlation between Aqr Large Cap and Doubleline Shiller Enhanced, you can compare the effects of market volatilities on Aqr Large and Doubleline Shiller 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 Large with a short position of Doubleline Shiller. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aqr Large and Doubleline Shiller.

Diversification Opportunities for Aqr Large and Doubleline Shiller

0.7

Correlation Coefficient

Aqr Large  Doubleline Shiller

Poor diversification

The 3 months correlation between Aqr and Doubleline is 0.7. Overlapping area represents the amount of risk that can be diversified away by holding Aqr Large Cap and Doubleline Shiller Enhanced in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Doubleline Shiller and Aqr Large 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 Large Cap are associated (or correlated) with Doubleline Shiller. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Doubleline Shiller has no effect on the direction of Aqr Large i.e., Aqr Large and Doubleline Shiller go up and down completely randomly.

Pair Corralation between Aqr Large and Doubleline Shiller

Assuming the 90 days horizon Aqr Large Cap is expected to under-perform the Doubleline Shiller. In addition to that, Aqr Large is 3.35 times more volatile than Doubleline Shiller Enhanced. It trades about -0.14 of its total potential returns per unit of risk. Doubleline Shiller Enhanced is currently generating about -0.04 per unit of volatility. If you would invest  1,628  in Doubleline Shiller Enhanced on November 29, 2024 and sell it today you would lose (29.00) from holding Doubleline Shiller Enhanced or give up 1.78% of portfolio value over 90 days.

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

Aqr Large Cap  vs.  Doubleline Shiller Enhanced

Aqr Large Cap

Risk-Adjusted Performance

Very Weak

Over the last 90 days Aqr Large Cap has generated negative risk-adjusted returns adding no value to fund investors. In spite of weak performance in the last few months, the Fund's basic indicators remain fairly strong which may send shares a bit higher in March 2025. The current disturbance may also be a sign of long term up-swing for the fund investors.

Doubleline Shiller

Risk-Adjusted Performance

Very Weak

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

Pair Trading with Aqr Large and Doubleline Shiller

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

The idea behind Aqr Large Cap and Doubleline Shiller Enhanced 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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..