Correlation Between Aggressive Investors and Boston Partners

Can any of the company-specific risk be diversified away by investing in both Aggressive Investors and Boston Partners 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 Aggressive Investors and Boston Partners into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Aggressive Investors 1 and Boston Partners Small, you can compare the effects of market volatilities on Aggressive Investors and Boston Partners 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 Aggressive Investors with a short position of Boston Partners. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aggressive Investors and Boston Partners.

Diversification Opportunities for Aggressive Investors and Boston Partners

0.56

Correlation Coefficient

Aggressive Investors  Boston Partners

Very weak diversification

The 3 months correlation between Aggressive and Boston is 0.56. Overlapping area represents the amount of risk that can be diversified away by holding Aggressive Investors 1 and Boston Partners Small in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Boston Partners Small and Aggressive Investors 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 Aggressive Investors 1 are associated (or correlated) with Boston Partners. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Boston Partners Small has no effect on the direction of Aggressive Investors i.e., Aggressive Investors and Boston Partners go up and down completely randomly.

Pair Corralation between Aggressive Investors and Boston Partners

Assuming the 90 days horizon Aggressive Investors 1 is expected to generate 0.85 times more return on investment than Boston Partners. However, Aggressive Investors 1 is 1.18 times less risky than Boston Partners. It trades about 0.25 of its potential returns per unit of risk. Boston Partners Small is currently generating about 0.13 per unit of risk. If you would invest  9,348  in Aggressive Investors 1 on May 3, 2025 and sell it today you would earn a total of  1,248  from holding Aggressive Investors 1 or generate 13.35% return on investment over 90 days.

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

Aggressive Investors 1  vs.  Boston Partners Small

Aggressive Investors

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Aggressive Investors 1 are ranked lower than 20 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak technical and fundamental indicators, Aggressive Investors showed solid returns over the last few months and may actually be approaching a breakup point.

Boston Partners Small

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Boston Partners Small are ranked lower than 9 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak fundamental indicators, Boston Partners may actually be approaching a critical reversion point that can send shares even higher in September 2025.

Pair Trading with Aggressive Investors and Boston Partners

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

The idea behind Aggressive Investors 1 and Boston Partners Small 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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.