Correlation Between Aqr Long-short and Fednat Holding
Can any of the company-specific risk be diversified away by investing in both Aqr Long-short and Fednat Holding 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 Long-short and Fednat Holding into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Aqr Long Short Equity and Fednat Holding Co, you can compare the effects of market volatilities on Aqr Long-short and Fednat Holding 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 Long-short with a short position of Fednat Holding. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aqr Long-short and Fednat Holding.
Diversification Opportunities for Aqr Long-short and Fednat Holding
-0.44 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Aqr and Fednat is -0.44. Overlapping area represents the amount of risk that can be diversified away by holding Aqr Long Short Equity and Fednat Holding Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fednat Holding and Aqr Long-short 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 Long Short Equity are associated (or correlated) with Fednat Holding. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fednat Holding has no effect on the direction of Aqr Long-short i.e., Aqr Long-short and Fednat Holding go up and down completely randomly.
Pair Corralation between Aqr Long-short and Fednat Holding
If you would invest 1,251 in Aqr Long Short Equity on January 24, 2024 and sell it today you would earn a total of 242.00 from holding Aqr Long Short Equity or generate 19.34% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 0.81% |
| Values | Daily Returns |
Aqr Long Short Equity vs. Fednat Holding Co
Performance |
| Timeline |
| Aqr Long Short |
| Fednat Holding |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Aqr Long-short and Fednat Holding Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aqr Long-short and Fednat Holding
The main advantage of trading using opposite Aqr Long-short and Fednat Holding positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aqr Long-short position performs unexpectedly, Fednat Holding 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 Fednat Holding will offset losses from the drop in Fednat Holding's long position.| Aqr Long-short vs. Aqr Large Cap | Aqr Long-short vs. Aqr Large Cap | Aqr Long-short vs. Aqr International Defensive | Aqr Long-short vs. Aqr International Defensive |
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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 Portfolio Center module to all portfolio management and optimization tools to improve performance of your portfolios.
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