Correlation Between Sa Real and Barings Emerging
Can any of the company-specific risk be diversified away by investing in both Sa Real and Barings Emerging 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 Sa Real and Barings Emerging into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sa Real Estate and Barings Emerging Markets, you can compare the effects of market volatilities on Sa Real and Barings Emerging 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 Sa Real with a short position of Barings Emerging. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sa Real and Barings Emerging.
Diversification Opportunities for Sa Real and Barings Emerging
0.7 | Correlation Coefficient |
Poor diversification
The 3 months correlation between SAREX and Barings is 0.7. Overlapping area represents the amount of risk that can be diversified away by holding Sa Real Estate and Barings Emerging Markets in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Barings Emerging Markets and Sa 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 Sa Real Estate are associated (or correlated) with Barings Emerging. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Barings Emerging Markets has no effect on the direction of Sa Real i.e., Sa Real and Barings Emerging go up and down completely randomly.
Pair Corralation between Sa Real and Barings Emerging
Assuming the 90 days horizon Sa Real is expected to generate 1.02 times less return on investment than Barings Emerging. In addition to that, Sa Real is 3.32 times more volatile than Barings Emerging Markets. It trades about 0.01 of its total potential returns per unit of risk. Barings Emerging Markets is currently generating about 0.04 per unit of volatility. If you would invest 695.00 in Barings Emerging Markets on October 16, 2024 and sell it today you would earn a total of 50.00 from holding Barings Emerging Markets or generate 7.19% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sa Real Estate vs. Barings Emerging Markets
Performance |
| Timeline |
| Sa Real Estate |
| Barings Emerging Markets |
Sa Real and Barings Emerging Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sa Real and Barings Emerging
The main advantage of trading using opposite Sa Real and Barings Emerging positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sa Real position performs unexpectedly, Barings Emerging 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 Emerging will offset losses from the drop in Barings Emerging's long position.| Sa Real vs. Quantitative Longshort Equity | Sa Real vs. T Rowe Price | Sa Real vs. Greenspring Fund Retail | Sa Real vs. Aqr Long Short Equity |
| Barings Emerging vs. Fidelity Real Estate | Barings Emerging vs. Pender Real Estate | Barings Emerging vs. Vy Clarion Real | Barings Emerging vs. Sa Real Estate |
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 Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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