Correlation Between Pender Real and Barrow Hanley
Can any of the company-specific risk be diversified away by investing in both Pender Real and Barrow Hanley 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 Pender Real and Barrow Hanley into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Pender Real Estate and Barrow Hanley Credit, you can compare the effects of market volatilities on Pender Real and Barrow Hanley 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 Pender Real with a short position of Barrow Hanley. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pender Real and Barrow Hanley.
Diversification Opportunities for Pender Real and Barrow Hanley
0.82 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Pender and Barrow is 0.82. Overlapping area represents the amount of risk that can be diversified away by holding Pender Real Estate and Barrow Hanley Credit in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Barrow Hanley Credit and Pender Real 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 Pender Real Estate are associated (or correlated) with Barrow Hanley. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Barrow Hanley Credit has no effect on the direction of Pender Real i.e., Pender Real and Barrow Hanley go up and down completely randomly.
Pair Corralation between Pender Real and Barrow Hanley
Assuming the 90 days horizon Pender Real is expected to generate 1.57 times less return on investment than Barrow Hanley. But when comparing it to its historical volatility, Pender Real Estate is 1.96 times less risky than Barrow Hanley. It trades about 0.3 of its potential returns per unit of risk. Barrow Hanley Credit is currently generating about 0.24 of returns per unit of risk over similar time horizon. If you would invest 934.00 in Barrow Hanley Credit on November 2, 2024 and sell it today you would earn a total of 36.00 from holding Barrow Hanley Credit or generate 3.85% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Pender Real Estate vs. Barrow Hanley Credit
Performance |
| Timeline |
| Pender Real Estate |
| Barrow Hanley Credit |
Pender Real and Barrow Hanley Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Pender Real and Barrow Hanley
The main advantage of trading using opposite Pender Real and Barrow Hanley positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Pender Real position performs unexpectedly, Barrow Hanley 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 Barrow Hanley will offset losses from the drop in Barrow Hanley's long position.| Pender Real vs. Pender Real Estate | Pender Real vs. Mndvux | Pender Real vs. Prudential Jennison International | Pender Real vs. Fidelity New Markets |
| Barrow Hanley vs. Bmo In Retirement Fund | Barrow Hanley vs. Barrow Hanley Value | Barrow Hanley vs. Advisors Inner Circle | Barrow Hanley vs. Barrow Hanley Concentrated |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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