Correlation Between Western Union and Barings Corporate
Can any of the company-specific risk be diversified away by investing in both Western Union and Barings Corporate 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 Western Union and Barings Corporate into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Western Union Co and Barings Corporate Investors, you can compare the effects of market volatilities on Western Union and Barings Corporate 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 Western Union with a short position of Barings Corporate. Check out your portfolio center. Please also check ongoing floating volatility patterns of Western Union and Barings Corporate.
Diversification Opportunities for Western Union and Barings Corporate
-0.52 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Western and Barings is -0.52. Overlapping area represents the amount of risk that can be diversified away by holding Western Union Co and Barings Corporate Investors in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Barings Corporate and Western Union 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 Western Union Co are associated (or correlated) with Barings Corporate. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Barings Corporate has no effect on the direction of Western Union i.e., Western Union and Barings Corporate go up and down completely randomly.
Pair Corralation between Western Union and Barings Corporate
Allowing for the 90-day total investment horizon Western Union Co is expected to under-perform the Barings Corporate. But the stock apears to be less risky and, when comparing its historical volatility, Western Union Co is 1.09 times less risky than Barings Corporate. The stock trades about -0.12 of its potential returns per unit of risk. The Barings Corporate Investors is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 1,899 in Barings Corporate Investors on August 26, 2024 and sell it today you would earn a total of 43.00 from holding Barings Corporate Investors or generate 2.26% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Western Union Co vs. Barings Corporate Investors
Performance |
| Timeline |
| Western Union |
| Barings Corporate |
Western Union and Barings Corporate Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Western Union and Barings Corporate
The main advantage of trading using opposite Western Union and Barings Corporate positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Western Union position performs unexpectedly, Barings Corporate 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 Corporate will offset losses from the drop in Barings Corporate's long position.| Western Union vs. American Express | Western Union vs. Morningstar Unconstrained Allocation | Western Union vs. Sitka Gold Corp | Western Union vs. MSCI ACWI exAUCONSUMER |
| Barings Corporate vs. Eaton Vance National | Barings Corporate vs. John Hancock Investors | Barings Corporate vs. MFS Municipal Income | Barings Corporate vs. RiverNorth Flexible Municipalome |
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 CEOs Directory module to screen CEOs from public companies around the world.
Other Complementary Tools
| Instant Ratings Determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| AI Portfolio Architect Use AI to generate optimal portfolios and find profitable investment opportunities | |
| Headlines Timeline Stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity | |
| Companies Directory Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals | |
| Price Ceiling Movement Calculate and plot Price Ceiling Movement for different equity instruments |