Correlation Between Baron Health and Jpmorgan Growth
Can any of the company-specific risk be diversified away by investing in both Baron Health and Jpmorgan 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 Health and Jpmorgan Growth 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 Jpmorgan Growth Advantage, you can compare the effects of market volatilities on Baron Health and Jpmorgan 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 Health with a short position of Jpmorgan Growth. Check out your portfolio center. Please also check ongoing floating volatility patterns of Baron Health and Jpmorgan Growth.
Diversification Opportunities for Baron Health and Jpmorgan Growth
0.71 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Baron and Jpmorgan is 0.71. Overlapping area represents the amount of risk that can be diversified away by holding Baron Health Care and Jpmorgan Growth Advantage in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jpmorgan Growth Advantage 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 Jpmorgan Growth. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jpmorgan Growth Advantage has no effect on the direction of Baron Health i.e., Baron Health and Jpmorgan Growth go up and down completely randomly.
Pair Corralation between Baron Health and Jpmorgan Growth
Assuming the 90 days horizon Baron Health Care is expected to under-perform the Jpmorgan Growth. But the mutual fund apears to be less risky and, when comparing its historical volatility, Baron Health Care is 1.41 times less risky than Jpmorgan Growth. The mutual fund trades about -0.23 of its potential returns per unit of risk. The Jpmorgan Growth Advantage is currently generating about -0.12 of returns per unit of risk over similar time horizon. If you would invest 2,950 in Jpmorgan Growth Advantage on November 28, 2024 and sell it today you would lose (76.00) from holding Jpmorgan Growth Advantage or give up 2.58% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Baron Health Care vs. Jpmorgan Growth Advantage
Performance |
| Timeline |
| Baron Health Care |
| Jpmorgan Growth Advantage |
Baron Health and Jpmorgan Growth Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Baron Health and Jpmorgan Growth
The main advantage of trading using opposite Baron Health and Jpmorgan Growth positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Baron Health position performs unexpectedly, Jpmorgan 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 Jpmorgan Growth will offset losses from the drop in Jpmorgan Growth's long position.| Baron Health vs. Fidelity Real Estate | Baron Health vs. Voya Real Estate | Baron Health vs. Forum Real Estate | Baron Health vs. Rreef Property Trust |
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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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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