Correlation Between Vanguard Small and Barclays Capital
Can any of the company-specific risk be diversified away by investing in both Vanguard Small and Barclays Capital 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 Vanguard Small and Barclays Capital into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Vanguard Small Cap Index and Barclays Capital, you can compare the effects of market volatilities on Vanguard Small and Barclays Capital 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 Vanguard Small with a short position of Barclays Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of Vanguard Small and Barclays Capital.
Diversification Opportunities for Vanguard Small and Barclays Capital
-0.61 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Vanguard and Barclays is -0.61. Overlapping area represents the amount of risk that can be diversified away by holding Vanguard Small Cap Index and Barclays Capital in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Barclays Capital and Vanguard Small 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 Vanguard Small Cap Index are associated (or correlated) with Barclays Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Barclays Capital has no effect on the direction of Vanguard Small i.e., Vanguard Small and Barclays Capital go up and down completely randomly.
Pair Corralation between Vanguard Small and Barclays Capital
If you would invest 22,672 in Vanguard Small Cap Index on September 3, 2024 and sell it today you would earn a total of 3,379 from holding Vanguard Small Cap Index or generate 14.9% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 0.0% |
| Values | Daily Returns |
Vanguard Small Cap Index vs. Barclays Capital
Performance |
| Timeline |
| Vanguard Small Cap |
| Barclays Capital |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Vanguard Small and Barclays Capital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Vanguard Small and Barclays Capital
The main advantage of trading using opposite Vanguard Small and Barclays Capital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Vanguard Small position performs unexpectedly, Barclays Capital 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 Barclays Capital will offset losses from the drop in Barclays Capital's long position.| Vanguard Small vs. Vanguard Mid Cap Index | Vanguard Small vs. Vanguard Small Cap Value | Vanguard Small vs. Vanguard FTSE Emerging | Vanguard Small vs. Vanguard Large Cap Index |
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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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