Correlation Between Baron Fintech and Western Asset
Can any of the company-specific risk be diversified away by investing in both Baron Fintech and Western Asset 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 Baron Fintech and Western Asset into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Baron Fintech and Western Asset Diversified, you can compare the effects of market volatilities on Baron Fintech and Western Asset 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 Baron Fintech with a short position of Western Asset. Check out your portfolio center. Please also check ongoing floating volatility patterns of Baron Fintech and Western Asset.
Diversification Opportunities for Baron Fintech and Western Asset
0.45 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Baron and Western is 0.45. Overlapping area represents the amount of risk that can be diversified away by holding Baron Fintech and Western Asset Diversified in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Western Asset Diversified and Baron Fintech 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 Baron Fintech are associated (or correlated) with Western Asset. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Western Asset Diversified has no effect on the direction of Baron Fintech i.e., Baron Fintech and Western Asset go up and down completely randomly.
Pair Corralation between Baron Fintech and Western Asset
Assuming the 90 days horizon Baron Fintech is expected to generate 2.52 times more return on investment than Western Asset. However, Baron Fintech is 2.52 times more volatile than Western Asset Diversified. It trades about 0.11 of its potential returns per unit of risk. Western Asset Diversified is currently generating about 0.01 per unit of risk. If you would invest 1,093 in Baron Fintech on December 1, 2024 and sell it today you would earn a total of 672.00 from holding Baron Fintech or generate 61.48% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Baron Fintech vs. Western Asset Diversified
Performance |
| Timeline |
| Baron Fintech |
| Western Asset Diversified |
Baron Fintech and Western Asset Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Baron Fintech and Western Asset
The main advantage of trading using opposite Baron Fintech and Western Asset positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Baron Fintech position performs unexpectedly, Western Asset 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 Western Asset will offset losses from the drop in Western Asset's long position.| Baron Fintech vs. Wealthbuilder Moderate Balanced | Baron Fintech vs. Wisdomtree Siegel Moderate | Baron Fintech vs. Transamerica Cleartrack Retirement | Baron Fintech vs. Jp Morgan Smartretirement |
| Western Asset vs. Msift High Yield | Western Asset vs. Siit High Yield | Western Asset vs. Artisan High Income | Western Asset vs. Barings High Yield |
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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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