Correlation Between Barnes and TFI International
Can any of the company-specific risk be diversified away by investing in both Barnes and TFI 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 Barnes and TFI International into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Barnes Group and TFI International, you can compare the effects of market volatilities on Barnes and TFI 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 Barnes with a short position of TFI International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Barnes and TFI International.
Diversification Opportunities for Barnes and TFI International
-0.32 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Barnes and TFI is -0.32. Overlapping area represents the amount of risk that can be diversified away by holding Barnes Group and TFI International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TFI International 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 TFI International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TFI International has no effect on the direction of Barnes i.e., Barnes and TFI International go up and down completely randomly.
Pair Corralation between Barnes and TFI International
Taking into account the 90-day investment horizon Barnes Group is expected to generate 1.24 times more return on investment than TFI International. However, Barnes is 1.24 times more volatile than TFI International. It trades about 0.09 of its potential returns per unit of risk. TFI International is currently generating about 0.01 per unit of risk. If you would invest 3,465 in Barnes Group on August 27, 2024 and sell it today you would earn a total of 1,217 from holding Barnes Group or generate 35.12% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Barnes Group vs. TFI International
Performance |
| Timeline |
| Barnes Group |
| TFI International |
Barnes and TFI International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Barnes and TFI International
The main advantage of trading using opposite Barnes and TFI International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Barnes position performs unexpectedly, TFI 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 TFI International will offset losses from the drop in TFI International's long position.| Barnes vs. Aquagold International | Barnes vs. Morningstar Unconstrained Allocation | Barnes vs. High Yield Municipal Fund | Barnes vs. Thrivent High Yield |
| TFI International vs. Old Dominion Freight | TFI International vs. ArcBest Corp | TFI International vs. Knight Transportation | TFI International vs. Universal Logistics Holdings |
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 CEOs Directory module to screen CEOs from public companies around the world.
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