Correlation Between Barings Global and Copeland Smid
Can any of the company-specific risk be diversified away by investing in both Barings Global and Copeland Smid 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 Global and Copeland Smid into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Barings Global Floating and Copeland Smid Cap, you can compare the effects of market volatilities on Barings Global and Copeland Smid 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 Global with a short position of Copeland Smid. Check out your portfolio center. Please also check ongoing floating volatility patterns of Barings Global and Copeland Smid.
Diversification Opportunities for Barings Global and Copeland Smid
0.73 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Barings and Copeland is 0.73. Overlapping area represents the amount of risk that can be diversified away by holding Barings Global Floating and Copeland Smid Cap in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Copeland Smid Cap and Barings Global 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 Global Floating are associated (or correlated) with Copeland Smid. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Copeland Smid Cap has no effect on the direction of Barings Global i.e., Barings Global and Copeland Smid go up and down completely randomly.
Pair Corralation between Barings Global and Copeland Smid
Assuming the 90 days horizon Barings Global is expected to generate 1.38 times less return on investment than Copeland Smid. But when comparing it to its historical volatility, Barings Global Floating is 5.4 times less risky than Copeland Smid. It trades about 0.22 of its potential returns per unit of risk. Copeland Smid Cap is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 1,312 in Copeland Smid Cap on September 2, 2024 and sell it today you would earn a total of 388.00 from holding Copeland Smid Cap or generate 29.57% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Barings Global Floating vs. Copeland Smid Cap
Performance |
| Timeline |
| Barings Global Floating |
| Copeland Smid Cap |
Barings Global and Copeland Smid Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Barings Global and Copeland Smid
The main advantage of trading using opposite Barings Global and Copeland Smid positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Barings Global position performs unexpectedly, Copeland Smid 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 Copeland Smid will offset losses from the drop in Copeland Smid's long position.| Barings Global vs. Barings Active Short | Barings Global vs. Barings Emerging Markets | Barings Global vs. Barings Emerging Markets | Barings Global vs. Barings Active Short |
| Copeland Smid vs. Fidelity Advisor Energy | Copeland Smid vs. Oil Gas Ultrasector | Copeland Smid vs. Clearbridge Energy Mlp | Copeland Smid vs. Tortoise Energy Independence |
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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
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