Correlation Between Barings Emerging and Strategic Asset
Can any of the company-specific risk be diversified away by investing in both Barings Emerging and Strategic 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 Emerging and Strategic Asset 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 Strategic Asset Management, you can compare the effects of market volatilities on Barings Emerging and Strategic 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 Emerging with a short position of Strategic Asset. Check out your portfolio center. Please also check ongoing floating volatility patterns of Barings Emerging and Strategic Asset.
Diversification Opportunities for Barings Emerging and Strategic Asset
0.22 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Barings and Strategic is 0.22. Overlapping area represents the amount of risk that can be diversified away by holding Barings Emerging Markets and Strategic Asset Management in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Strategic Asset Mana 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 Strategic Asset. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Strategic Asset Mana has no effect on the direction of Barings Emerging i.e., Barings Emerging and Strategic Asset go up and down completely randomly.
Pair Corralation between Barings Emerging and Strategic Asset
Assuming the 90 days horizon Barings Emerging is expected to generate 1.76 times less return on investment than Strategic Asset. But when comparing it to its historical volatility, Barings Emerging Markets is 1.07 times less risky than Strategic Asset. It trades about 0.07 of its potential returns per unit of risk. Strategic Asset Management is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest 1,043 in Strategic Asset Management on September 12, 2024 and sell it today you would earn a total of 249.00 from holding Strategic Asset Management or generate 23.87% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Barings Emerging Markets vs. Strategic Asset Management
Performance |
| Timeline |
| Barings Emerging Markets |
| Strategic Asset Mana |
Barings Emerging and Strategic Asset Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Barings Emerging and Strategic Asset
The main advantage of trading using opposite Barings Emerging and Strategic Asset positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Barings Emerging position performs unexpectedly, Strategic 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 Strategic Asset will offset losses from the drop in Strategic Asset'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 |
| Strategic Asset vs. Rbc Emerging Markets | Strategic Asset vs. Nasdaq 100 2x Strategy | Strategic Asset vs. Black Oak Emerging | Strategic Asset vs. Barings Emerging Markets |
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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.
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