Correlation Between Barings Active and International Growth
Can any of the company-specific risk be diversified away by investing in both Barings Active and International Growth 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 International Growth 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 International Growth And, you can compare the effects of market volatilities on Barings Active and International Growth 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 International Growth. Check out your portfolio center. Please also check ongoing floating volatility patterns of Barings Active and International Growth.
Diversification Opportunities for Barings Active and International Growth
0.08 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Barings and International is 0.08. Overlapping area represents the amount of risk that can be diversified away by holding Barings Active Short and International Growth And in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on International Growth And 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 International Growth. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of International Growth And has no effect on the direction of Barings Active i.e., Barings Active and International Growth go up and down completely randomly.
Pair Corralation between Barings Active and International Growth
Assuming the 90 days horizon Barings Active Short is expected to generate 0.15 times more return on investment than International Growth. However, Barings Active Short is 6.54 times less risky than International Growth. It trades about 0.09 of its potential returns per unit of risk. International Growth And is currently generating about -0.08 per unit of risk. If you would invest 923.00 in Barings Active Short on September 4, 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 Together |
| Strength | Insignificant |
| Accuracy | 95.24% |
| Values | Daily Returns |
Barings Active Short vs. International Growth And
Performance |
| Timeline |
| Barings Active Short |
| International Growth And |
Barings Active and International Growth Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Barings Active and International Growth
The main advantage of trading using opposite Barings Active and International Growth positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Barings Active position performs unexpectedly, International Growth 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 International Growth will offset losses from the drop in International Growth's long position.| Barings Active vs. Tiaa Cref Smallmid Cap Equity | Barings Active vs. Small Cap Stock | Barings Active vs. The Gabelli Small | Barings Active vs. T Rowe Price |
| International Growth vs. Qs Large Cap | International Growth vs. Federated Mdt Large | International Growth vs. Old Westbury Large | International Growth vs. Qs Global Equity |
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 Global Correlations module to find global opportunities by holding instruments from different markets.
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