Correlation Between Ab Bond and Barings Active
Can any of the company-specific risk be diversified away by investing in both Ab Bond and Barings Active 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 Ab Bond and Barings Active into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ab Bond Inflation and Barings Active Short, you can compare the effects of market volatilities on Ab Bond and Barings Active 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 Ab Bond with a short position of Barings Active. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ab Bond and Barings Active.
Diversification Opportunities for Ab Bond and Barings Active
0.04 | Correlation Coefficient |
Significant diversification
The 3 months correlation between ABNOX and Barings is 0.04. Overlapping area represents the amount of risk that can be diversified away by holding Ab Bond Inflation and Barings Active Short in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Barings Active Short and Ab Bond 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 Ab Bond Inflation are associated (or correlated) with Barings Active. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Barings Active Short has no effect on the direction of Ab Bond i.e., Ab Bond and Barings Active go up and down completely randomly.
Pair Corralation between Ab Bond and Barings Active
Assuming the 90 days horizon Ab Bond Inflation is expected to generate 1.61 times more return on investment than Barings Active. However, Ab Bond is 1.61 times more volatile than Barings Active Short. It trades about 0.14 of its potential returns per unit of risk. Barings Active Short is currently generating about 0.18 per unit of risk. If you would invest 1,011 in Ab Bond Inflation on September 13, 2024 and sell it today you would earn a total of 4.00 from holding Ab Bond Inflation or generate 0.4% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ab Bond Inflation vs. Barings Active Short
Performance |
| Timeline |
| Ab Bond Inflation |
| Barings Active Short |
Ab Bond and Barings Active Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ab Bond and Barings Active
The main advantage of trading using opposite Ab Bond and Barings Active positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ab Bond position performs unexpectedly, Barings Active 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 Barings Active will offset losses from the drop in Barings Active's long position.| Ab Bond vs. L Abbett Growth | Ab Bond vs. Artisan Small Cap | Ab Bond vs. Qs Moderate Growth | Ab Bond vs. Small Pany Growth |
| Barings Active vs. Pax High Yield | Barings Active vs. Jpmorgan High Yield | Barings Active vs. Msift High Yield | Barings Active vs. City National Rochdale |
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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
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