Correlation Between Baron Global and Polen Growth
Can any of the company-specific risk be diversified away by investing in both Baron Global and Polen Growth 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 Polen Growth 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 Polen Growth Fund, you can compare the effects of market volatilities on Baron Global and Polen Growth 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 Polen Growth. Check out your portfolio center. Please also check ongoing floating volatility patterns of Baron Global and Polen Growth.
Diversification Opportunities for Baron Global and Polen Growth
0.94 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between BARON and Polen is 0.94. Overlapping area represents the amount of risk that can be diversified away by holding Baron Global Advantage and Polen Growth Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Polen Growth 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 Polen Growth. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Polen Growth has no effect on the direction of Baron Global i.e., Baron Global and Polen Growth go up and down completely randomly.
Pair Corralation between Baron Global and Polen Growth
Assuming the 90 days horizon Baron Global Advantage is expected to generate 1.21 times more return on investment than Polen Growth. However, Baron Global is 1.21 times more volatile than Polen Growth Fund. It trades about 0.43 of its potential returns per unit of risk. Polen Growth Fund is currently generating about 0.32 per unit of risk. If you would invest 3,520 in Baron Global Advantage on September 2, 2024 and sell it today you would earn a total of 369.00 from holding Baron Global Advantage or generate 10.48% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Baron Global Advantage vs. Polen Growth Fund
Performance |
| Timeline |
| Baron Global Advantage |
| Polen Growth |
Baron Global and Polen Growth Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Baron Global and Polen Growth
The main advantage of trading using opposite Baron Global and Polen Growth positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Baron Global position performs unexpectedly, Polen Growth 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 Polen Growth will offset losses from the drop in Polen Growth'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 |
| Polen Growth vs. Congress Mid Cap | Polen Growth vs. Wcm Focused International | Polen Growth vs. Polen Growth Fund | Polen Growth vs. Polen International Growth |
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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
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