Correlation Between Barings Emerging and Pace Strategic
Can any of the company-specific risk be diversified away by investing in both Barings Emerging and Pace Strategic 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 Pace Strategic 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 Pace Strategic Fixed, you can compare the effects of market volatilities on Barings Emerging and Pace Strategic 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 Pace Strategic. Check out your portfolio center. Please also check ongoing floating volatility patterns of Barings Emerging and Pace Strategic.
Diversification Opportunities for Barings Emerging and Pace Strategic
0.48 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Barings and Pace is 0.48. Overlapping area represents the amount of risk that can be diversified away by holding Barings Emerging Markets and Pace Strategic Fixed in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pace Strategic Fixed 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 Pace Strategic. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pace Strategic Fixed has no effect on the direction of Barings Emerging i.e., Barings Emerging and Pace Strategic go up and down completely randomly.
Pair Corralation between Barings Emerging and Pace Strategic
Assuming the 90 days horizon Barings Emerging Markets is expected to generate 1.02 times more return on investment than Pace Strategic. However, Barings Emerging is 1.02 times more volatile than Pace Strategic Fixed. It trades about 0.07 of its potential returns per unit of risk. Pace Strategic Fixed is currently generating about 0.06 per unit of risk. If you would invest 670.00 in Barings Emerging Markets on September 2, 2024 and sell it today you would earn a total of 89.00 from holding Barings Emerging Markets or generate 13.28% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Barings Emerging Markets vs. Pace Strategic Fixed
Performance |
| Timeline |
| Barings Emerging Markets |
| Pace Strategic Fixed |
Barings Emerging and Pace Strategic Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Barings Emerging and Pace Strategic
The main advantage of trading using opposite Barings Emerging and Pace Strategic positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Barings Emerging position performs unexpectedly, Pace Strategic 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 Pace Strategic will offset losses from the drop in Pace Strategic's long position.| Barings Emerging vs. Vy Goldman Sachs | Barings Emerging vs. Oppenheimer Gold Special | Barings Emerging vs. Gabelli Gold Fund | Barings Emerging vs. James Balanced Golden |
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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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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