Correlation Between Barings Active and Harding Loevner
Can any of the company-specific risk be diversified away by investing in both Barings Active and Harding Loevner 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 Harding Loevner 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 Harding Loevner Funds, you can compare the effects of market volatilities on Barings Active and Harding Loevner 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 Harding Loevner. Check out your portfolio center. Please also check ongoing floating volatility patterns of Barings Active and Harding Loevner.
Diversification Opportunities for Barings Active and Harding Loevner
-0.17 | Correlation Coefficient |
Good diversification
The 3 months correlation between Barings and Harding is -0.17. Overlapping area represents the amount of risk that can be diversified away by holding Barings Active Short and Harding Loevner Funds in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Harding Loevner Funds 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 Harding Loevner. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Harding Loevner Funds has no effect on the direction of Barings Active i.e., Barings Active and Harding Loevner go up and down completely randomly.
Pair Corralation between Barings Active and Harding Loevner
Assuming the 90 days horizon Barings Active Short is expected to generate 0.19 times more return on investment than Harding Loevner. However, Barings Active Short is 5.29 times less risky than Harding Loevner. It trades about 0.09 of its potential returns per unit of risk. Harding Loevner Funds is currently generating about -0.13 per unit of risk. If you would invest 923.00 in Barings Active Short on September 1, 2024 and sell it today you would earn a total of 2.00 from holding Barings Active Short or generate 0.22% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.45% |
| Values | Daily Returns |
Barings Active Short vs. Harding Loevner Funds
Performance |
| Timeline |
| Barings Active Short |
| Harding Loevner Funds |
Barings Active and Harding Loevner Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Barings Active and Harding Loevner
The main advantage of trading using opposite Barings Active and Harding Loevner positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Barings Active position performs unexpectedly, Harding Loevner 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 Harding Loevner will offset losses from the drop in Harding Loevner'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 |
| Harding Loevner vs. Harding Loevner Funds | Harding Loevner vs. Harding Loevner Emerging | Harding Loevner vs. Harding Loevner Global | Harding Loevner vs. Harding Loevner Frontier |
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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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