Correlation Between Baron Global and Baron Real
Can any of the company-specific risk be diversified away by investing in both Baron Global and Baron Real 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 Baron Real 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 Baron Real Estate, you can compare the effects of market volatilities on Baron Global and Baron Real 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 Baron Real. Check out your portfolio center. Please also check ongoing floating volatility patterns of Baron Global and Baron Real.
Diversification Opportunities for Baron Global and Baron Real
0.84 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Baron and Baron is 0.84. Overlapping area represents the amount of risk that can be diversified away by holding Baron Global Advantage and Baron Real Estate in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Baron Real Estate 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 Baron Real. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Baron Real Estate has no effect on the direction of Baron Global i.e., Baron Global and Baron Real go up and down completely randomly.
Pair Corralation between Baron Global and Baron Real
Assuming the 90 days horizon Baron Global Advantage is expected to generate 1.36 times more return on investment than Baron Real. However, Baron Global is 1.36 times more volatile than Baron Real Estate. It trades about 0.21 of its potential returns per unit of risk. Baron Real Estate is currently generating about 0.21 per unit of risk. If you would invest 3,478 in Baron Global Advantage on August 29, 2024 and sell it today you would earn a total of 535.00 from holding Baron Global Advantage or generate 15.38% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 98.44% |
| Values | Daily Returns |
Baron Global Advantage vs. Baron Real Estate
Performance |
| Timeline |
| Baron Global Advantage |
| Baron Real Estate |
Baron Global and Baron Real Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Baron Global and Baron Real
The main advantage of trading using opposite Baron Global and Baron Real positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Baron Global position performs unexpectedly, Baron Real 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 Baron Real will offset losses from the drop in Baron Real's long position.| Baron Global vs. Baron Partners Fund | Baron Global vs. Baron Opportunity Fund | Baron Global vs. Baron Discovery Fund | Baron Global vs. Baron Growth Fund |
| Baron Real vs. Baron Real Estate | Baron Real vs. Baron Global Advantage | Baron Real vs. Baron Durable Advantage | Baron Real vs. Baron Wealthbuilder Fund |
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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
Other Complementary Tools
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
| Bollinger Bands Use Bollinger Bands indicator to analyze target price for a given investing horizon | |
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine | |
| Bond Analysis Evaluate and analyze corporate bonds as a potential investment for your portfolios. | |
| AI Portfolio Architect Use AI to generate optimal portfolios and find profitable investment opportunities |