Correlation Between Barings Emerging and Dana Large
Can any of the company-specific risk be diversified away by investing in both Barings Emerging and Dana Large 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 Emerging and Dana Large into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Barings Emerging Markets and Dana Large Cap, you can compare the effects of market volatilities on Barings Emerging and Dana Large 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 Emerging with a short position of Dana Large. Check out your portfolio center. Please also check ongoing floating volatility patterns of Barings Emerging and Dana Large.
Diversification Opportunities for Barings Emerging and Dana Large
-0.34 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Barings and Dana is -0.34. Overlapping area represents the amount of risk that can be diversified away by holding Barings Emerging Markets and Dana Large Cap in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dana Large Cap and Barings Emerging 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 Emerging Markets are associated (or correlated) with Dana Large. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dana Large Cap has no effect on the direction of Barings Emerging i.e., Barings Emerging and Dana Large go up and down completely randomly.
Pair Corralation between Barings Emerging and Dana Large
Assuming the 90 days horizon Barings Emerging is expected to generate 3.61 times less return on investment than Dana Large. But when comparing it to its historical volatility, Barings Emerging Markets is 2.13 times less risky than Dana Large. It trades about 0.07 of its potential returns per unit of risk. Dana Large Cap is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest 1,759 in Dana Large Cap on September 12, 2024 and sell it today you would earn a total of 948.00 from holding Dana Large Cap or generate 53.89% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Barings Emerging Markets vs. Dana Large Cap
Performance |
| Timeline |
| Barings Emerging Markets |
| Dana Large Cap |
Barings Emerging and Dana Large Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Barings Emerging and Dana Large
The main advantage of trading using opposite Barings Emerging and Dana Large positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Barings Emerging position performs unexpectedly, Dana Large 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 Dana Large will offset losses from the drop in Dana Large's long position.| Barings Emerging vs. Fidelity New Markets | Barings Emerging vs. Fidelity New Markets | Barings Emerging vs. Fidelity New Markets | Barings Emerging vs. SCOR PK |
| Dana Large vs. Gabelli Gold Fund | Dana Large vs. Franklin Gold Precious | Dana Large vs. Europac Gold Fund | Dana Large vs. Sprott Gold 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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
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