Correlation Between Baron Health and Loomis Sayles
Can any of the company-specific risk be diversified away by investing in both Baron Health and Loomis Sayles 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 Loomis Sayles 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 Loomis Sayles Small, you can compare the effects of market volatilities on Baron Health and Loomis Sayles 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 Loomis Sayles. Check out your portfolio center. Please also check ongoing floating volatility patterns of Baron Health and Loomis Sayles.
Diversification Opportunities for Baron Health and Loomis Sayles
-0.43 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Baron and Loomis is -0.43. Overlapping area represents the amount of risk that can be diversified away by holding Baron Health Care and Loomis Sayles Small in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Loomis Sayles Small 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 Loomis Sayles. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Loomis Sayles Small has no effect on the direction of Baron Health i.e., Baron Health and Loomis Sayles go up and down completely randomly.
Pair Corralation between Baron Health and Loomis Sayles
Assuming the 90 days horizon Baron Health Care is expected to under-perform the Loomis Sayles. But the mutual fund apears to be less risky and, when comparing its historical volatility, Baron Health Care is 1.13 times less risky than Loomis Sayles. The mutual fund trades about -0.23 of its potential returns per unit of risk. The Loomis Sayles Small is currently generating about -0.02 of returns per unit of risk over similar time horizon. If you would invest 2,778 in Loomis Sayles Small on September 12, 2024 and sell it today you would lose (19.00) from holding Loomis Sayles Small or give up 0.68% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Baron Health Care vs. Loomis Sayles Small
Performance |
| Timeline |
| Baron Health Care |
| Loomis Sayles Small |
Baron Health and Loomis Sayles Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Baron Health and Loomis Sayles
The main advantage of trading using opposite Baron Health and Loomis Sayles positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Baron Health position performs unexpectedly, Loomis Sayles 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 Loomis Sayles will offset losses from the drop in Loomis Sayles' 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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
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