Correlation Between Baron Growth and Pace High
Can any of the company-specific risk be diversified away by investing in both Baron Growth and Pace High 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 Growth and Pace High into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Baron Growth Fund and Pace High Yield, you can compare the effects of market volatilities on Baron Growth and Pace High 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 Growth with a short position of Pace High. Check out your portfolio center. Please also check ongoing floating volatility patterns of Baron Growth and Pace High.
Diversification Opportunities for Baron Growth and Pace High
0.7 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Baron and Pace is 0.7. Overlapping area represents the amount of risk that can be diversified away by holding Baron Growth Fund and Pace High Yield in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pace High Yield and Baron Growth 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 Growth Fund are associated (or correlated) with Pace High. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pace High Yield has no effect on the direction of Baron Growth i.e., Baron Growth and Pace High go up and down completely randomly.
Pair Corralation between Baron Growth and Pace High
Assuming the 90 days horizon Baron Growth Fund is expected to generate 5.42 times more return on investment than Pace High. However, Baron Growth is 5.42 times more volatile than Pace High Yield. It trades about 0.35 of its potential returns per unit of risk. Pace High Yield is currently generating about 0.11 per unit of risk. If you would invest 10,544 in Baron Growth Fund on September 1, 2024 and sell it today you would earn a total of 699.00 from holding Baron Growth Fund or generate 6.63% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.45% |
| Values | Daily Returns |
Baron Growth Fund vs. Pace High Yield
Performance |
| Timeline |
| Baron Growth |
| Pace High Yield |
Baron Growth and Pace High Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Baron Growth and Pace High
The main advantage of trading using opposite Baron Growth and Pace High positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Baron Growth position performs unexpectedly, Pace High 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 Pace High will offset losses from the drop in Pace High's long position.| Baron Growth vs. The Gabelli Equity | Baron Growth vs. Artisan Select Equity | Baron Growth vs. Jpmorgan Equity Income | Baron Growth vs. Us Strategic Equity |
| Pace High vs. Blackrock Moderate Prepared | Pace High vs. Jp Morgan Smartretirement | Pace High vs. Lifestyle Ii Moderate | Pace High vs. Target Retirement 2040 |
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 Portfolio Anywhere module to track or share privately all of your investments from the convenience of any device.
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