Correlation Between Red Oak and Barings Global
Can any of the company-specific risk be diversified away by investing in both Red Oak and Barings Global 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 Red Oak and Barings Global into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Red Oak Technology and Barings Global Floating, you can compare the effects of market volatilities on Red Oak and Barings Global 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 Red Oak with a short position of Barings Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of Red Oak and Barings Global.
Diversification Opportunities for Red Oak and Barings Global
-0.05 | Correlation Coefficient |
Good diversification
The 3 months correlation between Red and Barings is -0.05. Overlapping area represents the amount of risk that can be diversified away by holding Red Oak Technology and Barings Global Floating in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Barings Global Floating and Red Oak 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 Red Oak Technology are associated (or correlated) with Barings Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Barings Global Floating has no effect on the direction of Red Oak i.e., Red Oak and Barings Global go up and down completely randomly.
Pair Corralation between Red Oak and Barings Global
Assuming the 90 days horizon Red Oak Technology is expected to generate 6.5 times more return on investment than Barings Global. However, Red Oak is 6.5 times more volatile than Barings Global Floating. It trades about 0.08 of its potential returns per unit of risk. Barings Global Floating is currently generating about 0.19 per unit of risk. If you would invest 3,143 in Red Oak Technology on October 25, 2024 and sell it today you would earn a total of 1,857 from holding Red Oak Technology or generate 59.08% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Red Oak Technology vs. Barings Global Floating
Performance |
| Timeline |
| Red Oak Technology |
| Barings Global Floating |
Red Oak and Barings Global Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Red Oak and Barings Global
The main advantage of trading using opposite Red Oak and Barings Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Red Oak position performs unexpectedly, Barings Global 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 Global will offset losses from the drop in Barings Global's long position.| Red Oak vs. Pin Oak Equity | Red Oak vs. White Oak Select | Red Oak vs. Black Oak Emerging | Red Oak vs. Berkshire Focus |
| Barings Global vs. Wabmsx | Barings Global vs. Fabwx | Barings Global vs. Fzdaqx | Barings Global vs. Rational Dividend Capture |
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.
Other Complementary Tools
| Portfolio Center All portfolio management and optimization tools to improve performance of your portfolios | |
| Premium Stories Follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope | |
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation | |
| Money Flow Index Determine momentum by analyzing Money Flow Index and other technical indicators | |
| FinTech Suite Use AI to screen and filter profitable investment opportunities |