Correlation Between Baird Core and Oakmark Fund
Can any of the company-specific risk be diversified away by investing in both Baird Core and Oakmark Fund 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 Baird Core and Oakmark Fund into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Baird E Plus and Oakmark Fund Advisor, you can compare the effects of market volatilities on Baird Core and Oakmark Fund 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 Baird Core with a short position of Oakmark Fund. Check out your portfolio center. Please also check ongoing floating volatility patterns of Baird Core and Oakmark Fund.
Diversification Opportunities for Baird Core and Oakmark Fund
-0.76 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Baird and Oakmark is -0.76. Overlapping area represents the amount of risk that can be diversified away by holding Baird E Plus and Oakmark Fund Advisor in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Oakmark Fund Advisor and Baird Core 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 Baird E Plus are associated (or correlated) with Oakmark Fund. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Oakmark Fund Advisor has no effect on the direction of Baird Core i.e., Baird Core and Oakmark Fund go up and down completely randomly.
Pair Corralation between Baird Core and Oakmark Fund
Assuming the 90 days horizon Baird Core is expected to generate 4.05 times less return on investment than Oakmark Fund. But when comparing it to its historical volatility, Baird E Plus is 2.86 times less risky than Oakmark Fund. It trades about 0.1 of its potential returns per unit of risk. Oakmark Fund Advisor is currently generating about 0.14 of returns per unit of risk over similar time horizon. If you would invest 14,013 in Oakmark Fund Advisor on September 1, 2024 and sell it today you would earn a total of 2,283 from holding Oakmark Fund Advisor or generate 16.29% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Baird E Plus vs. Oakmark Fund Advisor
Performance |
| Timeline |
| Baird E Plus |
| Oakmark Fund Advisor |
Baird Core and Oakmark Fund Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Baird Core and Oakmark Fund
The main advantage of trading using opposite Baird Core and Oakmark Fund positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Baird Core position performs unexpectedly, Oakmark Fund 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 Oakmark Fund will offset losses from the drop in Oakmark Fund's long position.| Baird Core vs. Metropolitan West Total | Baird Core vs. Western Asset E | Baird Core vs. John Hancock Disciplined | Baird Core vs. American Beacon Bridgeway |
| Oakmark Fund vs. T Rowe Price | Oakmark Fund vs. Qs Large Cap | Oakmark Fund vs. John Hancock Investment | Oakmark Fund vs. Tax Managed Large Cap |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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