Correlation Between KLD and Barclays Capital
Can any of the company-specific risk be diversified away by investing in both KLD 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 KLD and Barclays Capital into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between KLD and Barclays Capital, you can compare the effects of market volatilities on KLD 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 KLD with a short position of Barclays Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of KLD and Barclays Capital.
Diversification Opportunities for KLD and Barclays Capital
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between KLD and Barclays is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding KLD and Barclays Capital in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Barclays Capital and KLD 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 KLD 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 KLD i.e., KLD and Barclays Capital go up and down completely randomly.
Pair Corralation between KLD and Barclays Capital
If you would invest 2,842 in Barclays Capital on January 17, 2024 and sell it today you would earn a total of 0.00 from holding Barclays Capital or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 0.0% |
| Values | Daily Returns |
KLD vs. Barclays Capital
Performance |
| Timeline |
| KLD |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Barclays Capital |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
KLD and Barclays Capital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with KLD and Barclays Capital
The main advantage of trading using opposite KLD and Barclays Capital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if KLD 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.The idea behind KLD and Barclays Capital pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Barclays Capital vs. Vanguard Total Stock | Barclays Capital vs. SPDR SP 500 | Barclays Capital vs. iShares Core SP | Barclays Capital vs. Vanguard Total Bond |
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 Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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