Correlation Between Federated Hermes and Barings Us
Can any of the company-specific risk be diversified away by investing in both Federated Hermes and Barings Us 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 Federated Hermes and Barings Us into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Federated Hermes Conservative and Barings High Yield, you can compare the effects of market volatilities on Federated Hermes and Barings Us 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 Federated Hermes with a short position of Barings Us. Check out your portfolio center. Please also check ongoing floating volatility patterns of Federated Hermes and Barings Us.
Diversification Opportunities for Federated Hermes and Barings Us
0.63 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Federated and Barings is 0.63. Overlapping area represents the amount of risk that can be diversified away by holding Federated Hermes Conservative and Barings High Yield in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Barings High Yield and Federated Hermes 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 Federated Hermes Conservative are associated (or correlated) with Barings Us. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Barings High Yield has no effect on the direction of Federated Hermes i.e., Federated Hermes and Barings Us go up and down completely randomly.
Pair Corralation between Federated Hermes and Barings Us
Assuming the 90 days horizon Federated Hermes is expected to generate 7.33 times less return on investment than Barings Us. But when comparing it to its historical volatility, Federated Hermes Conservative is 3.25 times less risky than Barings Us. It trades about 0.1 of its potential returns per unit of risk. Barings High Yield is currently generating about 0.22 of returns per unit of risk over similar time horizon. If you would invest 811.00 in Barings High Yield on November 3, 2024 and sell it today you would earn a total of 6.00 from holding Barings High Yield or generate 0.74% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Federated Hermes Conservative vs. Barings High Yield
Performance |
| Timeline |
| Federated Hermes Con |
| Barings High Yield |
Federated Hermes and Barings Us Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Federated Hermes and Barings Us
The main advantage of trading using opposite Federated Hermes and Barings Us positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Federated Hermes position performs unexpectedly, Barings Us 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 Barings Us will offset losses from the drop in Barings Us' long position.| Federated Hermes vs. Neuberger Berman Real | Federated Hermes vs. Columbia Real Estate | Federated Hermes vs. Dunham Real Estate | Federated Hermes vs. Fidelity 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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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