Correlation Between Baring Emerging and Coor Service
Can any of the company-specific risk be diversified away by investing in both Baring Emerging and Coor Service 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 Baring Emerging and Coor Service into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Baring Emerging Europe and Coor Service Management, you can compare the effects of market volatilities on Baring Emerging and Coor Service 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 Baring Emerging with a short position of Coor Service. Check out your portfolio center. Please also check ongoing floating volatility patterns of Baring Emerging and Coor Service.
Diversification Opportunities for Baring Emerging and Coor Service
-0.89 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Baring and Coor is -0.89. Overlapping area represents the amount of risk that can be diversified away by holding Baring Emerging Europe and Coor Service Management in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Coor Service Management and Baring Emerging 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 Baring Emerging Europe are associated (or correlated) with Coor Service. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Coor Service Management has no effect on the direction of Baring Emerging i.e., Baring Emerging and Coor Service go up and down completely randomly.
Pair Corralation between Baring Emerging and Coor Service
Assuming the 90 days trading horizon Baring Emerging Europe is expected to generate 0.56 times more return on investment than Coor Service. However, Baring Emerging Europe is 1.78 times less risky than Coor Service. It trades about 0.4 of its potential returns per unit of risk. Coor Service Management is currently generating about -0.35 per unit of risk. If you would invest 58,000 in Baring Emerging Europe on August 31, 2024 and sell it today you would earn a total of 4,500 from holding Baring Emerging Europe or generate 7.76% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Baring Emerging Europe vs. Coor Service Management
Performance |
| Timeline |
| Baring Emerging Europe |
| Coor Service Management |
Baring Emerging and Coor Service Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Baring Emerging and Coor Service
The main advantage of trading using opposite Baring Emerging and Coor Service positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Baring Emerging position performs unexpectedly, Coor Service 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 Coor Service will offset losses from the drop in Coor Service's long position.| Baring Emerging vs. Invesco Physical Silver | Baring Emerging vs. iShares Physical Silver | Baring Emerging vs. Greenroc Mining PLC | Baring Emerging vs. McEwen Mining |
| Coor Service vs. Check Point Software | Coor Service vs. Catena Media PLC | Coor Service vs. XLMedia PLC | Coor Service vs. Schweiter Technologies AG |
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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
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