Correlation Between Barnes and BrightView Holdings
Can any of the company-specific risk be diversified away by investing in both Barnes and BrightView Holdings 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 Barnes and BrightView Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Barnes Group and BrightView Holdings, you can compare the effects of market volatilities on Barnes and BrightView Holdings 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 Barnes with a short position of BrightView Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Barnes and BrightView Holdings.
Diversification Opportunities for Barnes and BrightView Holdings
-0.61 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Barnes and BrightView is -0.61. Overlapping area represents the amount of risk that can be diversified away by holding Barnes Group and BrightView Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BrightView Holdings and Barnes 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 Barnes Group are associated (or correlated) with BrightView Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BrightView Holdings has no effect on the direction of Barnes i.e., Barnes and BrightView Holdings go up and down completely randomly.
Pair Corralation between Barnes and BrightView Holdings
Taking into account the 90-day investment horizon Barnes Group is expected to generate 0.03 times more return on investment than BrightView Holdings. However, Barnes Group is 39.06 times less risky than BrightView Holdings. It trades about 0.65 of its potential returns per unit of risk. BrightView Holdings is currently generating about -0.03 per unit of risk. If you would invest 4,725 in Barnes Group on November 9, 2024 and sell it today you would earn a total of 23.00 from holding Barnes Group or generate 0.49% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 60.0% |
| Values | Daily Returns |
Barnes Group vs. BrightView Holdings
Performance |
| Timeline |
| Barnes Group |
Risk-Adjusted Performance
Strong
Weak | Strong |
| BrightView Holdings |
Barnes and BrightView Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Barnes and BrightView Holdings
The main advantage of trading using opposite Barnes and BrightView Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Barnes position performs unexpectedly, BrightView Holdings 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 BrightView Holdings will offset losses from the drop in BrightView Holdings' long position.| Barnes vs. Helios Technologies | Barnes vs. Enpro Industries | Barnes vs. Omega Flex | Barnes vs. Luxfer Holdings PLC |
| BrightView Holdings vs. Network 1 Technologies | BrightView Holdings vs. Civeo Corp | BrightView Holdings vs. Maximus | BrightView Holdings vs. CBIZ Inc |
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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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