Correlation Between Barings Global and Perkins Small
Can any of the company-specific risk be diversified away by investing in both Barings Global and Perkins Small 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 Perkins Small 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 Perkins Small Cap, you can compare the effects of market volatilities on Barings Global and Perkins Small 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 Perkins Small. Check out your portfolio center. Please also check ongoing floating volatility patterns of Barings Global and Perkins Small.
Diversification Opportunities for Barings Global and Perkins Small
0.56 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Barings and Perkins is 0.56. Overlapping area represents the amount of risk that can be diversified away by holding Barings Global Floating and Perkins Small Cap in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Perkins Small 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 Perkins Small. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Perkins Small Cap has no effect on the direction of Barings Global i.e., Barings Global and Perkins Small go up and down completely randomly.
Pair Corralation between Barings Global and Perkins Small
Assuming the 90 days horizon Barings Global Floating is expected to generate 0.06 times more return on investment than Perkins Small. However, Barings Global Floating is 17.15 times less risky than Perkins Small. It trades about 0.37 of its potential returns per unit of risk. Perkins Small Cap is currently generating about -0.2 per unit of risk. If you would invest 870.00 in Barings Global Floating on September 13, 2024 and sell it today you would earn a total of 9.00 from holding Barings Global Floating or generate 1.03% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Barings Global Floating vs. Perkins Small Cap
Performance |
| Timeline |
| Barings Global Floating |
| Perkins Small Cap |
Barings Global and Perkins Small Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Barings Global and Perkins Small
The main advantage of trading using opposite Barings Global and Perkins Small positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Barings Global position performs unexpectedly, Perkins Small 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 Perkins Small will offset losses from the drop in Perkins Small's long position.| Barings Global vs. T Rowe Price | Barings Global vs. Small Cap Stock | Barings Global vs. Qs Growth Fund | Barings Global vs. Century Small Cap |
| Perkins Small vs. Janus Overseas Fund | Perkins Small vs. Janus Balanced Fund | Perkins Small vs. Perkins Mid Cap | Perkins Small vs. Janus Enterprise Fund |
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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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