Correlation Between Baird Strategic and Lifex Income
Can any of the company-specific risk be diversified away by investing in both Baird Strategic and Lifex Income 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 Baird Strategic and Lifex Income into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Baird Strategic Municipal and Lifex Income, you can compare the effects of market volatilities on Baird Strategic and Lifex Income 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 Baird Strategic with a short position of Lifex Income. Check out your portfolio center. Please also check ongoing floating volatility patterns of Baird Strategic and Lifex Income.
Diversification Opportunities for Baird Strategic and Lifex Income
0.29 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Baird and Lifex is 0.29. Overlapping area represents the amount of risk that can be diversified away by holding Baird Strategic Municipal and Lifex Income in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lifex Income and Baird Strategic 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 Baird Strategic Municipal are associated (or correlated) with Lifex Income. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lifex Income has no effect on the direction of Baird Strategic i.e., Baird Strategic and Lifex Income go up and down completely randomly.
Pair Corralation between Baird Strategic and Lifex Income
If you would invest 1,026 in Baird Strategic Municipal on August 30, 2024 and sell it today you would earn a total of 7.00 from holding Baird Strategic Municipal or generate 0.68% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
Baird Strategic Municipal vs. Lifex Income
Performance |
| Timeline |
| Baird Strategic Municipal |
| Lifex Income |
Baird Strategic and Lifex Income Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Baird Strategic and Lifex Income
The main advantage of trading using opposite Baird Strategic and Lifex Income positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Baird Strategic position performs unexpectedly, Lifex Income 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 Lifex Income will offset losses from the drop in Lifex Income's long position.| Baird Strategic vs. Kinetics Small Cap | Baird Strategic vs. The Hartford Small | Baird Strategic vs. Ab Small Cap | Baird Strategic vs. Gmo Small Cap |
| Lifex Income vs. T Rowe Price | Lifex Income vs. Ep Emerging Markets | Lifex Income vs. Vanguard Emerging Markets | Lifex Income vs. Barings Emerging Markets |
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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
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