Correlation Between Barings Active and Vanguard Emerging
Can any of the company-specific risk be diversified away by investing in both Barings Active and Vanguard Emerging 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 Vanguard Emerging 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 Vanguard Emerging Markets, you can compare the effects of market volatilities on Barings Active and Vanguard Emerging 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 Vanguard Emerging. Check out your portfolio center. Please also check ongoing floating volatility patterns of Barings Active and Vanguard Emerging.
Diversification Opportunities for Barings Active and Vanguard Emerging
0.61 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Barings and VANGUARD is 0.61. Overlapping area represents the amount of risk that can be diversified away by holding Barings Active Short and Vanguard Emerging Markets in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Vanguard Emerging Markets 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 Vanguard Emerging. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Vanguard Emerging Markets has no effect on the direction of Barings Active i.e., Barings Active and Vanguard Emerging go up and down completely randomly.
Pair Corralation between Barings Active and Vanguard Emerging
Assuming the 90 days horizon Barings Active Short is expected to generate 0.17 times more return on investment than Vanguard Emerging. However, Barings Active Short is 5.96 times less risky than Vanguard Emerging. It trades about 0.14 of its potential returns per unit of risk. Vanguard Emerging Markets is currently generating about -0.22 per unit of risk. If you would invest 920.00 in Barings Active Short on August 29, 2024 and sell it today you would earn a total of 4.00 from holding Barings Active Short or generate 0.43% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Barings Active Short vs. Vanguard Emerging Markets
Performance |
| Timeline |
| Barings Active Short |
| Vanguard Emerging Markets |
Barings Active and Vanguard Emerging Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Barings Active and Vanguard Emerging
The main advantage of trading using opposite Barings Active and Vanguard Emerging positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Barings Active position performs unexpectedly, Vanguard Emerging 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 Vanguard Emerging will offset losses from the drop in Vanguard Emerging's long position.| Barings Active vs. Permanent Portfolio Class | Barings Active vs. HUMANA INC | Barings Active vs. Aquagold International | Barings Active vs. Barloworld Ltd ADR |
| Vanguard Emerging vs. Vanguard Emerging Markets | Vanguard Emerging vs. Vanguard Emerging Markets | Vanguard Emerging vs. Vanguard Emerging Markets | Vanguard Emerging vs. American Funds New |
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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
Other Complementary Tools
| Portfolio Dashboard Portfolio dashboard that provides centralized access to all your investments | |
| Portfolio Suggestion Get suggestions outside of your existing asset allocation including your own model portfolios | |
| ETF Categories List of ETF categories grouped based on various criteria, such as the investment strategy or type of investments | |
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation | |
| Equity Search Search for actively traded equities including funds and ETFs from over 30 global markets |