Correlation Between Barings Us and Ab Global
Can any of the company-specific risk be diversified away by investing in both Barings Us and Ab Global 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 Us and Ab Global into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Barings High Yield and Ab Global Risk, you can compare the effects of market volatilities on Barings Us and Ab Global 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 Us with a short position of Ab Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of Barings Us and Ab Global.
Diversification Opportunities for Barings Us and Ab Global
0.01 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Barings and CBSYX is 0.01. Overlapping area represents the amount of risk that can be diversified away by holding Barings High Yield and Ab Global Risk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ab Global Risk and Barings Us 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 High Yield are associated (or correlated) with Ab Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ab Global Risk has no effect on the direction of Barings Us i.e., Barings Us and Ab Global go up and down completely randomly.
Pair Corralation between Barings Us and Ab Global
Assuming the 90 days horizon Barings High Yield is expected to generate 0.06 times more return on investment than Ab Global. However, Barings High Yield is 17.34 times less risky than Ab Global. It trades about -0.36 of its potential returns per unit of risk. Ab Global Risk is currently generating about -0.26 per unit of risk. If you would invest 821.00 in Barings High Yield on October 11, 2024 and sell it today you would lose (10.00) from holding Barings High Yield or give up 1.22% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Barings High Yield vs. Ab Global Risk
Performance |
| Timeline |
| Barings High Yield |
| Ab Global Risk |
Barings Us and Ab Global Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Barings Us and Ab Global
The main advantage of trading using opposite Barings Us and Ab Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Barings Us position performs unexpectedly, Ab Global 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 Ab Global will offset losses from the drop in Ab Global's long position.| Barings Us vs. Amg Managers Centersquare | Barings Us vs. Jhancock Real Estate | Barings Us vs. Nexpoint Real Estate | Barings Us vs. Redwood Real Estate |
| Ab Global vs. Millerhoward High Income | Ab Global vs. Ab High Income | Ab Global vs. Msift High Yield | Ab Global vs. Barings High Yield |
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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
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