Correlation Between GoHealth and Barings BDC
Can any of the company-specific risk be diversified away by investing in both GoHealth and Barings BDC 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 GoHealth and Barings BDC into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between GoHealth and Barings BDC, you can compare the effects of market volatilities on GoHealth and Barings BDC 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 GoHealth with a short position of Barings BDC. Check out your portfolio center. Please also check ongoing floating volatility patterns of GoHealth and Barings BDC.
Diversification Opportunities for GoHealth and Barings BDC
0.15 | Correlation Coefficient |
Average diversification
The 3 months correlation between GoHealth and Barings is 0.15. Overlapping area represents the amount of risk that can be diversified away by holding GoHealth and Barings BDC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Barings BDC and GoHealth 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 GoHealth are associated (or correlated) with Barings BDC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Barings BDC has no effect on the direction of GoHealth i.e., GoHealth and Barings BDC go up and down completely randomly.
Pair Corralation between GoHealth and Barings BDC
Given the investment horizon of 90 days GoHealth is expected to under-perform the Barings BDC. In addition to that, GoHealth is 3.64 times more volatile than Barings BDC. It trades about -0.01 of its total potential returns per unit of risk. Barings BDC is currently generating about 0.1 per unit of volatility. If you would invest 677.00 in Barings BDC on August 31, 2024 and sell it today you would earn a total of 347.00 from holding Barings BDC or generate 51.26% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
GoHealth vs. Barings BDC
Performance |
| Timeline |
| GoHealth |
| Barings BDC |
GoHealth and Barings BDC Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GoHealth and Barings BDC
The main advantage of trading using opposite GoHealth and Barings BDC positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GoHealth position performs unexpectedly, Barings BDC 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 BDC will offset losses from the drop in Barings BDC's long position.| GoHealth vs. eHealth | GoHealth vs. Tian Ruixiang Holdings | GoHealth vs. Huize Holding | GoHealth vs. Selectquote |
| Barings BDC vs. Visa Class A | Barings BDC vs. RLJ Lodging Trust | Barings BDC vs. Aquagold International | Barings BDC vs. Stepstone Group |
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 Portfolio Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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