Correlation Between Global Techs and Baron Select

Can any of the company-specific risk be diversified away by investing in both Global Techs and Baron Select 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 Global Techs and Baron Select into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Global Techs and Baron Select Funds, you can compare the effects of market volatilities on Global Techs and Baron Select 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 Global Techs with a short position of Baron Select. Check out your portfolio center. Please also check ongoing floating volatility patterns of Global Techs and Baron Select.

Diversification Opportunities for Global Techs and Baron Select

0.0

Correlation Coefficient

Global Techs  Baron Select

Pay attention - limited upside

The 3 months correlation between Global and Baron is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Global Techs and Baron Select Funds in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Baron Select Funds and Global Techs 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 Global Techs are associated (or correlated) with Baron Select. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Baron Select Funds has no effect on the direction of Global Techs i.e., Global Techs and Baron Select go up and down completely randomly.

Pair Corralation between Global Techs and Baron Select

If you would invest (100.00) in Global Techs on December 29, 2024 and sell it today you would earn a total of  100.00  from holding Global Techs or generate -100.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

Global Techs  vs.  Baron Select Funds

Global Techs

Risk-Adjusted Performance

Very Weak

Over the last 90 days Global Techs has generated negative risk-adjusted returns adding no value to investors with long positions. Despite quite persistent essential indicators, Global Techs is not utilizing all of its potentials. The current stock price mess, may contribute to short-term losses for the institutional investors.

Baron Select Funds

Risk-Adjusted Performance

Very Weak

Over the last 90 days Baron Select Funds has generated negative risk-adjusted returns adding no value to fund investors. In spite of latest weak performance, the Fund's fundamental indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the fund investors.

Pair Trading with Global Techs and Baron Select

The main advantage of trading using opposite Global Techs and Baron Select positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Global Techs position performs unexpectedly, Baron Select 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 Select will offset losses from the drop in Baron Select's long position.

The idea behind Global Techs and Baron Select Funds pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.