Correlation Between Baron Global and Balanced Fund
Can any of the company-specific risk be diversified away by investing in both Baron Global and Balanced 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 Baron Global and Balanced Fund into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Baron Global Advantage and Balanced Fund Adviser, you can compare the effects of market volatilities on Baron Global and Balanced 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 Baron Global with a short position of Balanced Fund. Check out your portfolio center. Please also check ongoing floating volatility patterns of Baron Global and Balanced Fund.
Diversification Opportunities for Baron Global and Balanced Fund
0.75 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Baron and Balanced is 0.75. Overlapping area represents the amount of risk that can be diversified away by holding Baron Global Advantage and Balanced Fund Adviser in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Balanced Fund Adviser and Baron Global 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 Global Advantage are associated (or correlated) with Balanced Fund. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Balanced Fund Adviser has no effect on the direction of Baron Global i.e., Baron Global and Balanced Fund go up and down completely randomly.
Pair Corralation between Baron Global and Balanced Fund
Assuming the 90 days horizon Baron Global Advantage is expected to generate 1.99 times more return on investment than Balanced Fund. However, Baron Global is 1.99 times more volatile than Balanced Fund Adviser. It trades about 0.34 of its potential returns per unit of risk. Balanced Fund Adviser is currently generating about 0.12 per unit of risk. If you would invest 3,551 in Baron Global Advantage on August 28, 2024 and sell it today you would earn a total of 306.00 from holding Baron Global Advantage or generate 8.62% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.45% |
| Values | Daily Returns |
Baron Global Advantage vs. Balanced Fund Adviser
Performance |
| Timeline |
| Baron Global Advantage |
| Balanced Fund Adviser |
Baron Global and Balanced Fund Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Baron Global and Balanced Fund
The main advantage of trading using opposite Baron Global and Balanced Fund positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Baron Global position performs unexpectedly, Balanced 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 Balanced Fund will offset losses from the drop in Balanced Fund's long position.| Baron Global vs. Baron Opportunity Fund | Baron Global vs. Morgan Stanley Multi | Baron Global vs. Baron Focused Growth | Baron Global vs. Mid Cap Growth |
| Balanced Fund vs. Dynamic Growth Fund | Balanced Fund vs. Infrastructure Fund Retail | Balanced Fund vs. Quantex Fund Retail | Balanced Fund vs. Spectrum Fund Retail |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
Other Complementary Tools
| Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios | |
| Companies Directory Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals | |
| Portfolio Rebalancing Analyze risk-adjusted returns against different time horizons to find asset-allocation targets | |
| Portfolio Dashboard Portfolio dashboard that provides centralized access to all your investments | |
| Risk-Return Analysis View associations between returns expected from investment and the risk you assume |