Correlation Between Pimco Trends and Baron Small
Can any of the company-specific risk be diversified away by investing in both Pimco Trends and Baron Small 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 Pimco Trends and Baron Small into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Pimco Trends Managed and Baron Small Cap, you can compare the effects of market volatilities on Pimco Trends and Baron Small 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 Pimco Trends with a short position of Baron Small. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pimco Trends and Baron Small.
Diversification Opportunities for Pimco Trends and Baron Small
-0.56 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Pimco and Baron is -0.56. Overlapping area represents the amount of risk that can be diversified away by holding Pimco Trends Managed and Baron Small Cap in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Baron Small Cap and Pimco Trends 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 Pimco Trends Managed are associated (or correlated) with Baron Small. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Baron Small Cap has no effect on the direction of Pimco Trends i.e., Pimco Trends and Baron Small go up and down completely randomly.
Pair Corralation between Pimco Trends and Baron Small
Assuming the 90 days horizon Pimco Trends Managed is expected to generate 0.3 times more return on investment than Baron Small. However, Pimco Trends Managed is 3.28 times less risky than Baron Small. It trades about 0.04 of its potential returns per unit of risk. Baron Small Cap is currently generating about -0.03 per unit of risk. If you would invest 999.00 in Pimco Trends Managed on November 1, 2024 and sell it today you would earn a total of 14.00 from holding Pimco Trends Managed or generate 1.4% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Pimco Trends Managed vs. Baron Small Cap
Performance |
| Timeline |
| Pimco Trends Managed |
| Baron Small Cap |
Pimco Trends and Baron Small Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Pimco Trends and Baron Small
The main advantage of trading using opposite Pimco Trends and Baron Small positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Pimco Trends position performs unexpectedly, Baron Small 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 Small will offset losses from the drop in Baron Small's long position.| Pimco Trends vs. Oppenheimer Global Allocation | Pimco Trends vs. Neiman Large Cap | Pimco Trends vs. Enhanced Large Pany | Pimco Trends vs. Us Large Pany |
| Baron Small vs. Baron Growth Fund | Baron Small vs. Baron Asset Fund | Baron Small vs. Baron Partners Fund | Baron Small vs. Nasdaq 100 Fund Investor |
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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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