Correlation Between Barings Active and Ivy Asset
Can any of the company-specific risk be diversified away by investing in both Barings Active and Ivy Asset 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 Ivy Asset 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 Ivy Asset Strategy, you can compare the effects of market volatilities on Barings Active and Ivy Asset 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 Ivy Asset. Check out your portfolio center. Please also check ongoing floating volatility patterns of Barings Active and Ivy Asset.
Diversification Opportunities for Barings Active and Ivy Asset
0.58 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Barings and IVY is 0.58. Overlapping area represents the amount of risk that can be diversified away by holding Barings Active Short and Ivy Asset Strategy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ivy Asset Strategy 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 Ivy Asset. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ivy Asset Strategy has no effect on the direction of Barings Active i.e., Barings Active and Ivy Asset go up and down completely randomly.
Pair Corralation between Barings Active and Ivy Asset
Assuming the 90 days horizon Barings Active is expected to generate 1.63 times less return on investment than Ivy Asset. But when comparing it to its historical volatility, Barings Active Short is 5.09 times less risky than Ivy Asset. It trades about 0.23 of its potential returns per unit of risk. Ivy Asset Strategy is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 1,960 in Ivy Asset Strategy on September 1, 2024 and sell it today you would earn a total of 119.00 from holding Ivy Asset Strategy or generate 6.07% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 99.21% |
| Values | Daily Returns |
Barings Active Short vs. Ivy Asset Strategy
Performance |
| Timeline |
| Barings Active Short |
| Ivy Asset Strategy |
Barings Active and Ivy Asset Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Barings Active and Ivy Asset
The main advantage of trading using opposite Barings Active and Ivy Asset positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Barings Active position performs unexpectedly, Ivy Asset 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 Ivy Asset will offset losses from the drop in Ivy Asset'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 |
| Ivy Asset vs. Western Asset Diversified | Ivy Asset vs. Blackrock Sm Cap | Ivy Asset vs. Aqr Diversified Arbitrage | Ivy Asset vs. Oppenheimer International Diversified |
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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
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