Correlation Between Barings Active and Delaware Small
Can any of the company-specific risk be diversified away by investing in both Barings Active and Delaware Small 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 Barings Active and Delaware Small into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Barings Active Short and Delaware Small Cap, you can compare the effects of market volatilities on Barings Active and Delaware Small 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 Barings Active with a short position of Delaware Small. Check out your portfolio center. Please also check ongoing floating volatility patterns of Barings Active and Delaware Small.
Diversification Opportunities for Barings Active and Delaware Small
0.42 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Barings and Delaware is 0.42. Overlapping area represents the amount of risk that can be diversified away by holding Barings Active Short and Delaware Small Cap in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Delaware Small Cap and Barings Active 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 Barings Active Short are associated (or correlated) with Delaware Small. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Delaware Small Cap has no effect on the direction of Barings Active i.e., Barings Active and Delaware Small go up and down completely randomly.
Pair Corralation between Barings Active and Delaware Small
Assuming the 90 days horizon Barings Active is expected to generate 47.62 times less return on investment than Delaware Small. But when comparing it to its historical volatility, Barings Active Short is 12.72 times less risky than Delaware Small. It trades about 0.09 of its potential returns per unit of risk. Delaware Small Cap is currently generating about 0.33 of returns per unit of risk over similar time horizon. If you would invest 3,003 in Delaware Small Cap on September 1, 2024 and sell it today you would earn a total of 337.00 from holding Delaware Small Cap or generate 11.22% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
Barings Active Short vs. Delaware Small Cap
Performance |
| Timeline |
| Barings Active Short |
| Delaware Small Cap |
Barings Active and Delaware Small Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Barings Active and Delaware Small
The main advantage of trading using opposite Barings Active and Delaware Small positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Barings Active position performs unexpectedly, Delaware Small 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 Delaware Small will offset losses from the drop in Delaware Small's long position.| Barings Active vs. Ab Bond Inflation | Barings Active vs. Western Asset Inflation | Barings Active vs. Blackrock Inflation Protected | Barings Active vs. Aqr Managed Futures |
| Delaware Small vs. Arrow Managed Futures | Delaware Small vs. Bbh Partner Fund | Delaware Small vs. Fa 529 Aggressive | Delaware Small vs. Ab Value Fund |
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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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