Correlation Between Barnes and TrueBlue
Can any of the company-specific risk be diversified away by investing in both Barnes and TrueBlue 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 TrueBlue into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Barnes Group and TrueBlue, you can compare the effects of market volatilities on Barnes and TrueBlue 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 TrueBlue. Check out your portfolio center. Please also check ongoing floating volatility patterns of Barnes and TrueBlue.
Diversification Opportunities for Barnes and TrueBlue
Very good diversification
The 3 months correlation between Barnes and TrueBlue is -0.4. Overlapping area represents the amount of risk that can be diversified away by holding Barnes Group and TrueBlue in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TrueBlue 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 TrueBlue. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TrueBlue has no effect on the direction of Barnes i.e., Barnes and TrueBlue go up and down completely randomly.
Pair Corralation between Barnes and TrueBlue
Taking into account the 90-day investment horizon Barnes Group is expected to generate 0.03 times more return on investment than TrueBlue. However, Barnes Group is 35.22 times less risky than TrueBlue. It trades about 0.04 of its potential returns per unit of risk. TrueBlue is currently generating about -0.05 per unit of risk. If you would invest 4,678 in Barnes Group on August 27, 2024 and sell it today you would earn a total of 4.00 from holding Barnes Group or generate 0.09% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Barnes Group vs. TrueBlue
Performance |
| Timeline |
| Barnes Group |
| TrueBlue |
Barnes and TrueBlue Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Barnes and TrueBlue
The main advantage of trading using opposite Barnes and TrueBlue positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Barnes position performs unexpectedly, TrueBlue 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 TrueBlue will offset losses from the drop in TrueBlue's long position.| Barnes vs. Aquagold International | Barnes vs. Morningstar Unconstrained Allocation | Barnes vs. High Yield Municipal Fund | Barnes vs. Thrivent High Yield |
| TrueBlue vs. Kelly Services A | TrueBlue vs. Korn Ferry | TrueBlue vs. Heidrick Struggles International | TrueBlue vs. Hudson Global |
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 Commodity Directory module to find actively traded commodities issued by global exchanges.
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