Correlation Between Acm Dynamic and Western Asset
Can any of the company-specific risk be diversified away by investing in both Acm Dynamic and Western Asset 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 Acm Dynamic and Western Asset into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Acm Dynamic Opportunity and Western Asset Municipal, you can compare the effects of market volatilities on Acm Dynamic and Western Asset 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 Acm Dynamic with a short position of Western Asset. Check out your portfolio center. Please also check ongoing floating volatility patterns of Acm Dynamic and Western Asset.
Diversification Opportunities for Acm Dynamic and Western Asset
-0.7 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Acm and Western is -0.7. Overlapping area represents the amount of risk that can be diversified away by holding Acm Dynamic Opportunity and Western Asset Municipal in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Western Asset Municipal and Acm Dynamic 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 Acm Dynamic Opportunity are associated (or correlated) with Western Asset. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Western Asset Municipal has no effect on the direction of Acm Dynamic i.e., Acm Dynamic and Western Asset go up and down completely randomly.
Pair Corralation between Acm Dynamic and Western Asset
Assuming the 90 days horizon Acm Dynamic Opportunity is expected to generate 3.42 times more return on investment than Western Asset. However, Acm Dynamic is 3.42 times more volatile than Western Asset Municipal. It trades about 0.07 of its potential returns per unit of risk. Western Asset Municipal is currently generating about 0.03 per unit of risk. If you would invest 2,010 in Acm Dynamic Opportunity on August 24, 2024 and sell it today you would earn a total of 148.00 from holding Acm Dynamic Opportunity or generate 7.36% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Acm Dynamic Opportunity vs. Western Asset Municipal
Performance |
| Timeline |
| Acm Dynamic Opportunity |
| Western Asset Municipal |
Acm Dynamic and Western Asset Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Acm Dynamic and Western Asset
The main advantage of trading using opposite Acm Dynamic and Western Asset positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Acm Dynamic position performs unexpectedly, Western Asset 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 Western Asset will offset losses from the drop in Western Asset's long position.| Acm Dynamic vs. Jpmorgan Hedged Equity | Acm Dynamic vs. Jpmorgan Hedged Equity | Acm Dynamic vs. Gateway Fund Class | Acm Dynamic vs. Gateway Fund Class |
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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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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