Correlation Between Barrett Business and TriNet

Can any of the company-specific risk be diversified away by investing in both Barrett Business and TriNet 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 Barrett Business and TriNet into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Barrett Business Services and TriNet Group, you can compare the effects of market volatilities on Barrett Business and TriNet 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 Barrett Business with a short position of TriNet. Check out your portfolio center. Please also check ongoing floating volatility patterns of Barrett Business and TriNet.

Diversification Opportunities for Barrett Business and TriNet

-0.56

Correlation Coefficient

Barrett Business  TriNet

Excellent diversification

The 3 months correlation between Barrett and TriNet is -0.56. Overlapping area represents the amount of risk that can be diversified away by holding Barrett Business Services and TriNet Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TriNet Group and Barrett Business 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 Barrett Business Services are associated (or correlated) with TriNet. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TriNet Group has no effect on the direction of Barrett Business i.e., Barrett Business and TriNet go up and down completely randomly.

Pair Corralation between Barrett Business and TriNet

Given the investment horizon of 90 days Barrett Business Services is expected to generate 0.65 times more return on investment than TriNet. However, Barrett Business Services is 1.54 times less risky than TriNet. It trades about 0.17 of its potential returns per unit of risk. TriNet Group is currently generating about -0.12 per unit of risk. If you would invest  4,068  in Barrett Business Services on April 27, 2025 and sell it today you would earn a total of  502.00  from holding Barrett Business Services or generate 12.34% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	100.0%
Values	Daily Returns

Barrett Business Services  vs.  TriNet Group

Barrett Business Services

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Barrett Business Services are ranked lower than 13 (%) of all global equities and portfolios over the last 90 days. Despite fairly inconsistent basic indicators, Barrett Business may actually be approaching a critical reversion point that can send shares even higher in August 2025.

TriNet Group

Risk-Adjusted Performance

Very Weak

Over the last 90 days TriNet Group has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of weak performance in the last few months, the Stock's technical and fundamental indicators remain comparatively stable which may send shares a bit higher in August 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

Pair Trading with Barrett Business and TriNet

The main advantage of trading using opposite Barrett Business and TriNet positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Barrett Business position performs unexpectedly, TriNet 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 TriNet will offset losses from the drop in TriNet's long position.

The idea behind Barrett Business Services and TriNet Group 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.

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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 AI Portfolio Prophet module to use AI to generate optimal portfolios and find profitable investment opportunities.