Correlation Between Growth Portfolio and Baron Global
Can any of the company-specific risk be diversified away by investing in both Growth Portfolio and Baron Global 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 Growth Portfolio and Baron Global into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Growth Portfolio Class and Baron Global Advantage, you can compare the effects of market volatilities on Growth Portfolio and Baron Global 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 Growth Portfolio with a short position of Baron Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of Growth Portfolio and Baron Global.
Diversification Opportunities for Growth Portfolio and Baron Global
0.96 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Growth and Baron is 0.96. Overlapping area represents the amount of risk that can be diversified away by holding Growth Portfolio Class and Baron Global Advantage in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Baron Global Advantage and Growth Portfolio 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 Growth Portfolio Class are associated (or correlated) with Baron Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Baron Global Advantage has no effect on the direction of Growth Portfolio i.e., Growth Portfolio and Baron Global go up and down completely randomly.
Pair Corralation between Growth Portfolio and Baron Global
Assuming the 90 days horizon Growth Portfolio Class is expected to generate 1.8 times more return on investment than Baron Global. However, Growth Portfolio is 1.8 times more volatile than Baron Global Advantage. It trades about 0.45 of its potential returns per unit of risk. Baron Global Advantage is currently generating about 0.33 per unit of risk. If you would invest 4,230 in Growth Portfolio Class on August 30, 2024 and sell it today you would earn a total of 964.00 from holding Growth Portfolio Class or generate 22.79% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Growth Portfolio Class vs. Baron Global Advantage
Performance |
| Timeline |
| Growth Portfolio Class |
| Baron Global Advantage |
Growth Portfolio and Baron Global Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Growth Portfolio and Baron Global
The main advantage of trading using opposite Growth Portfolio and Baron Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Growth Portfolio position performs unexpectedly, Baron Global 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 Global will offset losses from the drop in Baron Global's long position.| Growth Portfolio vs. Mid Cap Growth | Growth Portfolio vs. Morgan Stanley Multi | Growth Portfolio vs. Small Pany Growth | Growth Portfolio vs. Blackrock Science Technology |
| Baron Global vs. Baron Opportunity Fund | Baron Global vs. Morgan Stanley Multi | Baron Global vs. Baron Focused Growth | Baron Global vs. Mid Cap Growth |
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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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