Correlation Between Washington Mutual and Shandong
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By analyzing existing cross correlation between Washington Mutual Investors and Shandong Hi Speed RoadBridge, you can compare the effects of market volatilities on Washington Mutual and Shandong 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 Washington Mutual with a short position of Shandong. Check out your portfolio center. Please also check ongoing floating volatility patterns of Washington Mutual and Shandong.
Diversification Opportunities for Washington Mutual and Shandong
0.61 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Washington and Shandong is 0.61. Overlapping area represents the amount of risk that can be diversified away by holding Washington Mutual Investors and Shandong Hi Speed RoadBridge in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shandong Hi Speed and Washington Mutual 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 Washington Mutual Investors are associated (or correlated) with Shandong. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shandong Hi Speed has no effect on the direction of Washington Mutual i.e., Washington Mutual and Shandong go up and down completely randomly.
Pair Corralation between Washington Mutual and Shandong
Assuming the 90 days horizon Washington Mutual Investors is expected to generate 0.57 times more return on investment than Shandong. However, Washington Mutual Investors is 1.77 times less risky than Shandong. It trades about 0.13 of its potential returns per unit of risk. Shandong Hi Speed RoadBridge is currently generating about -0.25 per unit of risk. If you would invest 6,205 in Washington Mutual Investors on October 23, 2024 and sell it today you would earn a total of 96.00 from holding Washington Mutual Investors or generate 1.55% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 85.71% |
| Values | Daily Returns |
Washington Mutual Investors vs. Shandong Hi Speed RoadBridge
Performance |
| Timeline |
| Washington Mutual |
| Shandong Hi Speed |
Washington Mutual and Shandong Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Washington Mutual and Shandong
The main advantage of trading using opposite Washington Mutual and Shandong positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Washington Mutual position performs unexpectedly, Shandong 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 Shandong will offset losses from the drop in Shandong's long position.| Washington Mutual vs. Great West Goldman Sachs | Washington Mutual vs. Gabelli Gold Fund | Washington Mutual vs. Global Gold Fund | Washington Mutual vs. The Gold Bullion |
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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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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