Correlation Between Barings Global and Acrex
Can any of the company-specific risk be diversified away by investing in both Barings Global and Acrex 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 Acrex 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 Acrex, you can compare the effects of market volatilities on Barings Global and Acrex 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 Acrex. Check out your portfolio center. Please also check ongoing floating volatility patterns of Barings Global and Acrex.
Diversification Opportunities for Barings Global and Acrex
-0.79 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Barings and Acrex is -0.79. Overlapping area represents the amount of risk that can be diversified away by holding Barings Global Floating and Acrex in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Acrex 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 Acrex. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Acrex has no effect on the direction of Barings Global i.e., Barings Global and Acrex go up and down completely randomly.
Pair Corralation between Barings Global and Acrex
Assuming the 90 days horizon Barings Global Floating is expected to generate 0.06 times more return on investment than Acrex. However, Barings Global Floating is 15.7 times less risky than Acrex. It trades about -0.16 of its potential returns per unit of risk. Acrex is currently generating about -0.29 per unit of risk. If you would invest 878.00 in Barings Global Floating on September 28, 2024 and sell it today you would lose (3.00) from holding Barings Global Floating or give up 0.34% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 95.24% |
| Values | Daily Returns |
Barings Global Floating vs. Acrex
Performance |
| Timeline |
| Barings Global Floating |
| Acrex |
Barings Global and Acrex Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Barings Global and Acrex
The main advantage of trading using opposite Barings Global and Acrex positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Barings Global position performs unexpectedly, Acrex 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 Acrex will offset losses from the drop in Acrex'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 |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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