Correlation Between Barings Us and Dunham High
Can any of the company-specific risk be diversified away by investing in both Barings Us and Dunham High 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 Dunham High 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 Dunham High Yield, you can compare the effects of market volatilities on Barings Us and Dunham High 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 Dunham High. Check out your portfolio center. Please also check ongoing floating volatility patterns of Barings Us and Dunham High.
Diversification Opportunities for Barings Us and Dunham High
0.94 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Barings and Dunham is 0.94. Overlapping area represents the amount of risk that can be diversified away by holding Barings High Yield and Dunham High Yield in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dunham High Yield 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 Dunham High. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dunham High Yield has no effect on the direction of Barings Us i.e., Barings Us and Dunham High go up and down completely randomly.
Pair Corralation between Barings Us and Dunham High
Assuming the 90 days horizon Barings High Yield is expected to generate 0.63 times more return on investment than Dunham High. However, Barings High Yield is 1.6 times less risky than Dunham High. It trades about -0.36 of its potential returns per unit of risk. Dunham High Yield is currently generating about -0.27 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 | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Barings High Yield vs. Dunham High Yield
Performance |
| Timeline |
| Barings High Yield |
| Dunham High Yield |
Barings Us and Dunham High Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Barings Us and Dunham High
The main advantage of trading using opposite Barings Us and Dunham High positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Barings Us position performs unexpectedly, Dunham High 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 Dunham High will offset losses from the drop in Dunham High'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 |
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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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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