Correlation Between Polen Global and Brown Advisory
Can any of the company-specific risk be diversified away by investing in both Polen Global and Brown Advisory 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 Polen Global and Brown Advisory into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Polen Global Growth and Brown Advisory Sustainable, you can compare the effects of market volatilities on Polen Global and Brown Advisory 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 Polen Global with a short position of Brown Advisory. Check out your portfolio center. Please also check ongoing floating volatility patterns of Polen Global and Brown Advisory.
Diversification Opportunities for Polen Global and Brown Advisory
0.89 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Polen and Brown is 0.89. Overlapping area represents the amount of risk that can be diversified away by holding Polen Global Growth and Brown Advisory Sustainable in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Brown Advisory Susta and Polen Global 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 Polen Global Growth are associated (or correlated) with Brown Advisory. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Brown Advisory Susta has no effect on the direction of Polen Global i.e., Polen Global and Brown Advisory go up and down completely randomly.
Pair Corralation between Polen Global and Brown Advisory
Assuming the 90 days horizon Polen Global Growth is expected to generate 0.77 times more return on investment than Brown Advisory. However, Polen Global Growth is 1.29 times less risky than Brown Advisory. It trades about 0.26 of its potential returns per unit of risk. Brown Advisory Sustainable is currently generating about 0.07 per unit of risk. If you would invest 2,602 in Polen Global Growth on August 30, 2024 and sell it today you would earn a total of 138.00 from holding Polen Global Growth or generate 5.3% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Polen Global Growth vs. Brown Advisory Sustainable
Performance |
| Timeline |
| Polen Global Growth |
| Brown Advisory Susta |
Polen Global and Brown Advisory Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Polen Global and Brown Advisory
The main advantage of trading using opposite Polen Global and Brown Advisory positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Polen Global position performs unexpectedly, Brown Advisory 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 Brown Advisory will offset losses from the drop in Brown Advisory's long position.| Polen Global vs. Polen Growth Fund | Polen Global vs. Baron Global Advantage | Polen Global vs. Polen Growth Fund | Polen Global vs. Polen Global Growth |
| Brown Advisory vs. Focused Dynamic Growth | Brown Advisory vs. Df Dent Midcap | Brown Advisory vs. Growth Portfolio Class | Brown Advisory vs. Laudus Large 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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
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