Correlation Between Aqr Tm and Defensive Market
Can any of the company-specific risk be diversified away by investing in both Aqr Tm and Defensive Market 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 Tm and Defensive Market into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Aqr Tm Emerging and Defensive Market Strategies, you can compare the effects of market volatilities on Aqr Tm and Defensive Market 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 Tm with a short position of Defensive Market. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aqr Tm and Defensive Market.
Diversification Opportunities for Aqr Tm and Defensive Market
0.98 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Aqr and Defensive is 0.98. Overlapping area represents the amount of risk that can be diversified away by holding Aqr Tm Emerging and Defensive Market Strategies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Defensive Market Str and Aqr Tm 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 Tm Emerging are associated (or correlated) with Defensive Market. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Defensive Market Str has no effect on the direction of Aqr Tm i.e., Aqr Tm and Defensive Market go up and down completely randomly.
Pair Corralation between Aqr Tm and Defensive Market
Assuming the 90 days horizon Aqr Tm Emerging is expected to generate 1.71 times more return on investment than Defensive Market. However, Aqr Tm is 1.71 times more volatile than Defensive Market Strategies. It trades about 0.38 of its potential returns per unit of risk. Defensive Market Strategies is currently generating about 0.37 per unit of risk. If you would invest 1,023 in Aqr Tm Emerging on April 22, 2025 and sell it today you would earn a total of 182.00 from holding Aqr Tm Emerging or generate 17.79% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 98.41% |
| Values | Daily Returns |
Aqr Tm Emerging vs. Defensive Market Strategies
Performance |
| Timeline |
| Aqr Tm Emerging |
| Defensive Market Str |
Aqr Tm and Defensive Market Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aqr Tm and Defensive Market
The main advantage of trading using opposite Aqr Tm and Defensive Market positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aqr Tm position performs unexpectedly, Defensive Market 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 Defensive Market will offset losses from the drop in Defensive Market's long position.| Aqr Tm vs. American Funds Tax Exempt | Aqr Tm vs. Western Asset Short | Aqr Tm vs. Maryland Short Term Tax Free | Aqr Tm vs. Blackrock Global Longshort |
| Defensive Market vs. Ab Value Fund | Defensive Market vs. T Rowe Price | Defensive Market vs. Small Cap Stock | Defensive Market vs. Rational Defensive Growth |
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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
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