Correlation Between Barings Active and Rbc Impact
Can any of the company-specific risk be diversified away by investing in both Barings Active and Rbc Impact 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 Rbc Impact 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 Rbc Impact Bond, you can compare the effects of market volatilities on Barings Active and Rbc Impact 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 Rbc Impact. Check out your portfolio center. Please also check ongoing floating volatility patterns of Barings Active and Rbc Impact.
Diversification Opportunities for Barings Active and Rbc Impact
-0.17 | Correlation Coefficient |
Good diversification
The 3 months correlation between Barings and Rbc is -0.17. Overlapping area represents the amount of risk that can be diversified away by holding Barings Active Short and Rbc Impact Bond in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Rbc Impact Bond 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 Rbc Impact. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Rbc Impact Bond has no effect on the direction of Barings Active i.e., Barings Active and Rbc Impact go up and down completely randomly.
Pair Corralation between Barings Active and Rbc Impact
Assuming the 90 days horizon Barings Active is expected to generate 2.17 times less return on investment than Rbc Impact. But when comparing it to its historical volatility, Barings Active Short is 2.75 times less risky than Rbc Impact. It trades about 0.11 of its potential returns per unit of risk. Rbc Impact Bond is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 857.00 in Rbc Impact Bond on August 30, 2024 and sell it today you would earn a total of 6.00 from holding Rbc Impact Bond or generate 0.7% 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. Rbc Impact Bond
Performance |
| Timeline |
| Barings Active Short |
| Rbc Impact Bond |
Barings Active and Rbc Impact Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Barings Active and Rbc Impact
The main advantage of trading using opposite Barings Active and Rbc Impact positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Barings Active position performs unexpectedly, Rbc Impact 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 Rbc Impact will offset losses from the drop in Rbc Impact's long position.| Barings Active vs. Us Government Securities | Barings Active vs. Prudential Government Income | Barings Active vs. Us Government Plus | Barings Active vs. Us Government Securities |
| Rbc Impact vs. Sterling Capital Short | Rbc Impact vs. Siit Ultra Short | Rbc Impact vs. Barings Active Short | Rbc Impact vs. Aqr Long Short 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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
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