Correlation Between Barings High and Payden High
Can any of the company-specific risk be diversified away by investing in both Barings High and Payden High 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 Barings High and Payden High into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Barings High Yield and Payden High Income, you can compare the effects of market volatilities on Barings High and Payden High 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 Barings High with a short position of Payden High. Check out your portfolio center. Please also check ongoing floating volatility patterns of Barings High and Payden High.
Diversification Opportunities for Barings High and Payden High
0.98 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Barings and Payden is 0.98. Overlapping area represents the amount of risk that can be diversified away by holding Barings High Yield and Payden High Income in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Payden High Income and Barings High 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 Barings High Yield are associated (or correlated) with Payden High. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Payden High Income has no effect on the direction of Barings High i.e., Barings High and Payden High go up and down completely randomly.
Pair Corralation between Barings High and Payden High
Assuming the 90 days horizon Barings High Yield is expected to generate 1.06 times more return on investment than Payden High. However, Barings High is 1.06 times more volatile than Payden High Income. It trades about 0.37 of its potential returns per unit of risk. Payden High Income is currently generating about 0.38 per unit of risk. If you would invest 786.00 in Barings High Yield on April 24, 2025 and sell it today you would earn a total of 34.00 from holding Barings High Yield or generate 4.33% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Barings High Yield vs. Payden High Income
Performance |
| Timeline |
| Barings High Yield |
| Payden High Income |
Barings High and Payden High Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Barings High and Payden High
The main advantage of trading using opposite Barings High and Payden High positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Barings High position performs unexpectedly, Payden High 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 Payden High will offset losses from the drop in Payden High's long position.| Barings High vs. Ab E Opportunities | Barings High vs. Tax Managed Large Cap | Barings High vs. Victory High Yield | Barings High vs. Alternative Asset Allocation |
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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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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