Correlation Between Baillie Gifford and CT Private

Can any of the company-specific risk be diversified away by investing in both Baillie Gifford and CT Private 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 Baillie Gifford and CT Private into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Baillie Gifford Growth and CT Private Equity, you can compare the effects of market volatilities on Baillie Gifford and CT Private 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 Baillie Gifford with a short position of CT Private. Check out your portfolio center. Please also check ongoing floating volatility patterns of Baillie Gifford and CT Private.

Diversification Opportunities for Baillie Gifford and CT Private

0.59

Correlation Coefficient

Baillie Gifford  CT Private

Very weak diversification

The 3 months correlation between Baillie and CTPE is 0.59. Overlapping area represents the amount of risk that can be diversified away by holding Baillie Gifford Growth and CT Private Equity in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CT Private Equity and Baillie Gifford 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 Baillie Gifford Growth are associated (or correlated) with CT Private. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CT Private Equity has no effect on the direction of Baillie Gifford i.e., Baillie Gifford and CT Private go up and down completely randomly.

Pair Corralation between Baillie Gifford and CT Private

Assuming the 90 days trading horizon Baillie Gifford Growth is expected to under-perform the CT Private. In addition to that, Baillie Gifford is 1.11 times more volatile than CT Private Equity. It trades about -0.18 of its total potential returns per unit of risk. CT Private Equity is currently generating about -0.04 per unit of volatility. If you would invest  48,345  in CT Private Equity on December 30, 2024 and sell it today you would lose (2,145) from holding CT Private Equity or give up 4.44% of portfolio value over 90 days.

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

Baillie Gifford Growth  vs.  CT Private Equity

Baillie Gifford Growth

Risk-Adjusted Performance

Very Weak

Over the last 90 days Baillie Gifford Growth has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of uncertain performance in the last few months, the Etf's technical and fundamental indicators remain rather sound which may send shares a bit higher in April 2025. The latest tumult may also be a sign of longer-term up-swing for the fund shareholders.

CT Private Equity

Risk-Adjusted Performance

Very Weak

Over the last 90 days CT Private Equity has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, CT Private is not utilizing all of its potentials. The newest stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with Baillie Gifford and CT Private

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

The idea behind Baillie Gifford Growth and CT Private Equity 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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.