Correlation Between Blrc Sgy and Baron Emerging
Can any of the company-specific risk be diversified away by investing in both Blrc Sgy and Baron Emerging 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 Blrc Sgy and Baron Emerging into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Blrc Sgy Mnp and Baron Emerging Markets, you can compare the effects of market volatilities on Blrc Sgy and Baron Emerging 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 Blrc Sgy with a short position of Baron Emerging. Check out your portfolio center. Please also check ongoing floating volatility patterns of Blrc Sgy and Baron Emerging.
Diversification Opportunities for Blrc Sgy and Baron Emerging
0.03 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Blrc and Baron is 0.03. Overlapping area represents the amount of risk that can be diversified away by holding Blrc Sgy Mnp and Baron Emerging Markets in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Baron Emerging Markets and Blrc Sgy 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 Blrc Sgy Mnp are associated (or correlated) with Baron Emerging. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Baron Emerging Markets has no effect on the direction of Blrc Sgy i.e., Blrc Sgy and Baron Emerging go up and down completely randomly.
Pair Corralation between Blrc Sgy and Baron Emerging
Assuming the 90 days horizon Blrc Sgy Mnp is expected to generate 0.4 times more return on investment than Baron Emerging. However, Blrc Sgy Mnp is 2.49 times less risky than Baron Emerging. It trades about -0.05 of its potential returns per unit of risk. Baron Emerging Markets is currently generating about -0.04 per unit of risk. If you would invest 1,052 in Blrc Sgy Mnp on October 23, 2024 and sell it today you would lose (6.00) from holding Blrc Sgy Mnp or give up 0.57% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Blrc Sgy Mnp vs. Baron Emerging Markets
Performance |
| Timeline |
| Blrc Sgy Mnp |
| Baron Emerging Markets |
Blrc Sgy and Baron Emerging Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Blrc Sgy and Baron Emerging
The main advantage of trading using opposite Blrc Sgy and Baron Emerging positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Blrc Sgy position performs unexpectedly, Baron Emerging 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 Emerging will offset losses from the drop in Baron Emerging's long position.| Blrc Sgy vs. Morningstar Defensive Bond | Blrc Sgy vs. Western Asset Municipal | Blrc Sgy vs. Intermediate Term Bond Fund | Blrc Sgy vs. Multisector Bond Sma |
| Baron Emerging vs. Blrc Sgy Mnp | Baron Emerging vs. T Rowe Price | Baron Emerging vs. Ishares Municipal Bond | Baron Emerging vs. Lord Abbett Intermediate |
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 Portfolio Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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