Correlation Between Baron Real and Baron New
Can any of the company-specific risk be diversified away by investing in both Baron Real and Baron New 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 Real and Baron New into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Baron Real Estate and Baron New Asia, you can compare the effects of market volatilities on Baron Real and Baron New 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 Real with a short position of Baron New. Check out your portfolio center. Please also check ongoing floating volatility patterns of Baron Real and Baron New.
Diversification Opportunities for Baron Real and Baron New
0.32 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Baron and Baron is 0.32. Overlapping area represents the amount of risk that can be diversified away by holding Baron Real Estate and Baron New Asia in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Baron New Asia and Baron Real 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 Real Estate are associated (or correlated) with Baron New. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Baron New Asia has no effect on the direction of Baron Real i.e., Baron Real and Baron New go up and down completely randomly.
Pair Corralation between Baron Real and Baron New
Assuming the 90 days horizon Baron Real Estate is expected to generate 1.62 times more return on investment than Baron New. However, Baron Real is 1.62 times more volatile than Baron New Asia. It trades about 0.27 of its potential returns per unit of risk. Baron New Asia is currently generating about -0.2 per unit of risk. If you would invest 3,965 in Baron Real Estate on September 1, 2024 and sell it today you would earn a total of 249.00 from holding Baron Real Estate or generate 6.28% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 19.05% |
| Values | Daily Returns |
Baron Real Estate vs. Baron New Asia
Performance |
| Timeline |
| Baron Real Estate |
| Baron New Asia |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Baron Real and Baron New Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Baron Real and Baron New
The main advantage of trading using opposite Baron Real and Baron New positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Baron Real position performs unexpectedly, Baron New 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 Baron New will offset losses from the drop in Baron New's long position.| Baron Real vs. Baron Opportunity Fund | Baron Real vs. Baron Global Advantage | Baron Real vs. Baron Partners Fund | Baron Real vs. Baron Focused Growth |
| Baron New vs. Baron Real Estate | Baron New vs. Baron Real Estate | Baron New vs. Baron Real Estate | Baron New vs. Baron Small Cap |
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.
Other Complementary Tools
| Money Managers Screen money managers from public funds and ETFs managed around the world | |
| Content Syndication Quickly integrate customizable finance content to your own investment portal | |
| Positions Ratings Determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
| Portfolio Anywhere Track or share privately all of your investments from the convenience of any device |