Correlation Between Baird Core and Income Fund
Can any of the company-specific risk be diversified away by investing in both Baird Core and Income 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 Income 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 Income Fund Income, you can compare the effects of market volatilities on Baird Core and Income 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 Income Fund. Check out your portfolio center. Please also check ongoing floating volatility patterns of Baird Core and Income Fund.
Diversification Opportunities for Baird Core and Income Fund
0.99 | Correlation Coefficient |
No risk reduction
The 3 months correlation between Baird and Income is 0.99. Overlapping area represents the amount of risk that can be diversified away by holding Baird E Plus and Income Fund Income in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Income Fund Income 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 Income Fund. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Income Fund Income has no effect on the direction of Baird Core i.e., Baird Core and Income Fund go up and down completely randomly.
Pair Corralation between Baird Core and Income Fund
Assuming the 90 days horizon Baird E Plus is expected to generate 1.05 times more return on investment than Income Fund. However, Baird Core is 1.05 times more volatile than Income Fund Income. It trades about -0.06 of its potential returns per unit of risk. Income Fund Income is currently generating about -0.12 per unit of risk. If you would invest 1,015 in Baird E Plus on August 26, 2024 and sell it today you would lose (4.00) from holding Baird E Plus or give up 0.39% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Baird E Plus vs. Income Fund Income
Performance |
| Timeline |
| Baird E Plus |
| Income Fund Income |
Baird Core and Income Fund Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Baird Core and Income Fund
The main advantage of trading using opposite Baird Core and Income Fund positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Baird Core position performs unexpectedly, Income 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 Income Fund will offset losses from the drop in Income Fund's long position.| Baird Core vs. Income Fund Income | Baird Core vs. Artisan International Value | Baird Core vs. Prudential Total Return | Baird Core vs. Pimco Income Fund |
| Income Fund vs. Capital Growth Fund | Income Fund vs. Emerging Markets Fund | Income Fund vs. High Income Fund | Income Fund vs. International Fund International |
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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.
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