Correlation Between Baron Health and Issachar Fund
Can any of the company-specific risk be diversified away by investing in both Baron Health and Issachar Fund 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 Issachar Fund 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 Issachar Fund Class, you can compare the effects of market volatilities on Baron Health and Issachar Fund 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 Issachar Fund. Check out your portfolio center. Please also check ongoing floating volatility patterns of Baron Health and Issachar Fund.
Diversification Opportunities for Baron Health and Issachar Fund
0.1 | Correlation Coefficient |
Average diversification
The 3 months correlation between Baron and Issachar is 0.1. Overlapping area represents the amount of risk that can be diversified away by holding Baron Health Care and Issachar Fund Class in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Issachar Fund Class 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 Issachar Fund. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Issachar Fund Class has no effect on the direction of Baron Health i.e., Baron Health and Issachar Fund go up and down completely randomly.
Pair Corralation between Baron Health and Issachar Fund
Assuming the 90 days horizon Baron Health Care is expected to generate 0.54 times more return on investment than Issachar Fund. However, Baron Health Care is 1.84 times less risky than Issachar Fund. It trades about 0.18 of its potential returns per unit of risk. Issachar Fund Class is currently generating about 0.07 per unit of risk. If you would invest 1,934 in Baron Health Care on October 19, 2024 and sell it today you would earn a total of 49.00 from holding Baron Health Care or generate 2.53% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Baron Health Care vs. Issachar Fund Class
Performance |
| Timeline |
| Baron Health Care |
| Issachar Fund Class |
Baron Health and Issachar Fund Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Baron Health and Issachar Fund
The main advantage of trading using opposite Baron Health and Issachar Fund positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Baron Health position performs unexpectedly, Issachar Fund 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 Issachar Fund will offset losses from the drop in Issachar Fund's long position.| Baron Health vs. Red Oak Technology | Baron Health vs. Columbia Global Technology | Baron Health vs. Icon Information Technology | Baron Health vs. Hennessy Technology Fund |
| Issachar Fund vs. Blackrock Health Sciences | Issachar Fund vs. Baillie Gifford Health | Issachar Fund vs. Baron Health Care | Issachar Fund vs. Delaware Healthcare 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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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