Correlation Between Baron Health and Eaton Vance
Can any of the company-specific risk be diversified away by investing in both Baron Health and Eaton Vance 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 Health and Eaton Vance into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Baron Health Care and Eaton Vance Short, you can compare the effects of market volatilities on Baron Health and Eaton Vance 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 Health with a short position of Eaton Vance. Check out your portfolio center. Please also check ongoing floating volatility patterns of Baron Health and Eaton Vance.
Diversification Opportunities for Baron Health and Eaton Vance
-0.64 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Baron and Eaton is -0.64. Overlapping area represents the amount of risk that can be diversified away by holding Baron Health Care and Eaton Vance Short in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eaton Vance Short and Baron Health 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 Health Care are associated (or correlated) with Eaton Vance. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Eaton Vance Short has no effect on the direction of Baron Health i.e., Baron Health and Eaton Vance go up and down completely randomly.
Pair Corralation between Baron Health and Eaton Vance
If you would invest 899.00 in Eaton Vance Short on September 12, 2024 and sell it today you would earn a total of 0.00 from holding Eaton Vance Short or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Baron Health Care vs. Eaton Vance Short
Performance |
| Timeline |
| Baron Health Care |
| Eaton Vance Short |
Baron Health and Eaton Vance Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Baron Health and Eaton Vance
The main advantage of trading using opposite Baron Health and Eaton Vance positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Baron Health position performs unexpectedly, Eaton Vance 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 Eaton Vance will offset losses from the drop in Eaton Vance's long position.| Baron Health vs. Adams Natural Resources | Baron Health vs. Oil Gas Ultrasector | Baron Health vs. Dreyfus Natural Resources | Baron Health vs. Alpsalerian Energy Infrastructure |
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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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
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