Correlation Between Valic Company and Aqr International

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

By analyzing existing cross correlation between Valic Company I and Aqr International Relaxed, you can compare the effects of market volatilities on Valic Company and Aqr International 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 Valic Company with a short position of Aqr International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Valic Company and Aqr International.

Diversification Opportunities for Valic Company and Aqr International

0.0

Correlation Coefficient

Valic Company  Aqr International

Pay attention - limited upside

The 3 months correlation between Valic and Aqr is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Valic Company I and Aqr International Relaxed in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aqr International Relaxed and Valic Company 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 Valic Company I are associated (or correlated) with Aqr International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aqr International Relaxed has no effect on the direction of Valic Company i.e., Valic Company and Aqr International go up and down completely randomly.

Pair Corralation between Valic Company and Aqr International

If you would invest  0.00  in Aqr International Relaxed on February 5, 2024 and sell it today you would earn a total of  0.00  from holding Aqr International Relaxed or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	4.55%
Values	Daily Returns

Valic Company I  vs.  Aqr International Relaxed

Valic Company I

Risk-Adjusted Performance

7 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Valic Company I are ranked lower than 7 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak fundamental indicators, Valic Company may actually be approaching a critical reversion point that can send shares even higher in June 2024.

Aqr International Relaxed

Risk-Adjusted Performance

0 of 100

Very Weak

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

Pair Trading with Valic Company and Aqr International

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

The idea behind Valic Company I and Aqr International Relaxed 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.

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 Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.