Correlation Between Barclays Capital and Invesco DB
Can any of the company-specific risk be diversified away by investing in both Barclays Capital and Invesco DB 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 Barclays Capital and Invesco DB into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Barclays Capital and Invesco DB Precious, you can compare the effects of market volatilities on Barclays Capital and Invesco DB 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 Barclays Capital with a short position of Invesco DB. Check out your portfolio center. Please also check ongoing floating volatility patterns of Barclays Capital and Invesco DB.
Diversification Opportunities for Barclays Capital and Invesco DB
-0.54 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Barclays and Invesco is -0.54. Overlapping area represents the amount of risk that can be diversified away by holding Barclays Capital and Invesco DB Precious in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Invesco DB Precious and Barclays Capital 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 Barclays Capital are associated (or correlated) with Invesco DB. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Invesco DB Precious has no effect on the direction of Barclays Capital i.e., Barclays Capital and Invesco DB go up and down completely randomly.
Pair Corralation between Barclays Capital and Invesco DB
Considering the 90-day investment horizon Barclays Capital is expected to generate 7.77 times less return on investment than Invesco DB. In addition to that, Barclays Capital is 1.16 times more volatile than Invesco DB Precious. It trades about 0.01 of its total potential returns per unit of risk. Invesco DB Precious is currently generating about 0.08 per unit of volatility. If you would invest 4,466 in Invesco DB Precious on August 28, 2024 and sell it today you would earn a total of 1,884 from holding Invesco DB Precious or generate 42.19% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 30.85% |
| Values | Daily Returns |
Barclays Capital vs. Invesco DB Precious
Performance |
| Timeline |
| Barclays Capital |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Invesco DB Precious |
Barclays Capital and Invesco DB Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Barclays Capital and Invesco DB
The main advantage of trading using opposite Barclays Capital and Invesco DB positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Barclays Capital position performs unexpectedly, Invesco DB 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 Invesco DB will offset losses from the drop in Invesco DB's long position.| Barclays Capital vs. Blackrock Muniholdings Ny | Barclays Capital vs. MFS Investment Grade | Barclays Capital vs. Eaton Vance National | Barclays Capital vs. Invesco High Income |
| Invesco DB vs. Invesco DB Energy | Invesco DB vs. Invesco DB Base | Invesco DB vs. Invesco DB Oil | Invesco DB vs. iPath Bloomberg Commodity |
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 Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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