Correlation Between Brown Advisory and Growth Portfolio

Can any of the company-specific risk be diversified away by investing in both Brown Advisory and Growth Portfolio 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 Brown Advisory and Growth Portfolio into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Brown Advisory Sustainable and Growth Portfolio Class, you can compare the effects of market volatilities on Brown Advisory and Growth Portfolio 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 Brown Advisory with a short position of Growth Portfolio. Check out your portfolio center. Please also check ongoing floating volatility patterns of Brown Advisory and Growth Portfolio.

Diversification Opportunities for Brown Advisory and Growth Portfolio

0.96

Correlation Coefficient

Brown Advisory  Growth Portfolio

Almost no diversification

The 3 months correlation between Brown and Growth is 0.96. Overlapping area represents the amount of risk that can be diversified away by holding Brown Advisory Sustainable and Growth Portfolio Class in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Growth Portfolio Class and Brown Advisory 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 Brown Advisory Sustainable are associated (or correlated) with Growth Portfolio. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Growth Portfolio Class has no effect on the direction of Brown Advisory i.e., Brown Advisory and Growth Portfolio go up and down completely randomly.

Pair Corralation between Brown Advisory and Growth Portfolio

Assuming the 90 days horizon Brown Advisory is expected to generate 1.46 times less return on investment than Growth Portfolio. But when comparing it to its historical volatility, Brown Advisory Sustainable is 1.5 times less risky than Growth Portfolio. It trades about 0.21 of its potential returns per unit of risk. Growth Portfolio Class is currently generating about 0.2 of returns per unit of risk over similar time horizon. If you would invest  4,927  in Growth Portfolio Class on May 6, 2025 and sell it today you would earn a total of  946.00  from holding Growth Portfolio Class or generate 19.2% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Strong
Accuracy	100.0%
Values	Daily Returns

Brown Advisory Sustainable  vs.  Growth Portfolio Class

Brown Advisory Susta

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Brown Advisory Sustainable are ranked lower than 16 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak basic indicators, Brown Advisory showed solid returns over the last few months and may actually be approaching a breakup point.

Growth Portfolio Class

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Growth Portfolio Class are ranked lower than 16 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak technical and fundamental indicators, Growth Portfolio showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Brown Advisory and Growth Portfolio

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

The idea behind Brown Advisory Sustainable and Growth Portfolio Class 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.

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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 Anywhere module to track or share privately all of your investments from the convenience of any device.