Correlation Between Barings Active and Real Assets
Can any of the company-specific risk be diversified away by investing in both Barings Active and Real Assets 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 Real Assets 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 Real Assets Portfolio, you can compare the effects of market volatilities on Barings Active and Real Assets 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 Real Assets. Check out your portfolio center. Please also check ongoing floating volatility patterns of Barings Active and Real Assets.
Diversification Opportunities for Barings Active and Real Assets
-0.01 | Correlation Coefficient |
Good diversification
The 3 months correlation between Barings and Real is -0.01. Overlapping area represents the amount of risk that can be diversified away by holding Barings Active Short and Real Assets Portfolio in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Real Assets Portfolio 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 Real Assets. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Real Assets Portfolio has no effect on the direction of Barings Active i.e., Barings Active and Real Assets go up and down completely randomly.
Pair Corralation between Barings Active and Real Assets
Assuming the 90 days horizon Barings Active is expected to generate 3.42 times less return on investment than Real Assets. But when comparing it to its historical volatility, Barings Active Short is 4.38 times less risky than Real Assets. It trades about 0.11 of its potential returns per unit of risk. Real Assets Portfolio is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 1,090 in Real Assets Portfolio on September 12, 2024 and sell it today you would earn a total of 8.00 from holding Real Assets Portfolio or generate 0.73% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Barings Active Short vs. Real Assets Portfolio
Performance |
| Timeline |
| Barings Active Short |
| Real Assets Portfolio |
Barings Active and Real Assets Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Barings Active and Real Assets
The main advantage of trading using opposite Barings Active and Real Assets positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Barings Active position performs unexpectedly, Real Assets 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 Real Assets will offset losses from the drop in Real Assets' long position.| Barings Active vs. SCOR PK | Barings Active vs. Morningstar Unconstrained Allocation | Barings Active vs. Via Renewables | Barings Active vs. Bondbloxx ETF Trust |
| Real Assets vs. Quantitative Longshort Equity | Real Assets vs. Astor Longshort Fund | Real Assets vs. Barings Active Short | Real Assets vs. Virtus Multi Sector Short |
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 Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
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