Correlation Between Washington Mutual and Athabasca Oil
Can any of the company-specific risk be diversified away by investing in both Washington Mutual and Athabasca Oil 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 Washington Mutual and Athabasca Oil into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Washington Mutual Investors and Athabasca Oil Corp, you can compare the effects of market volatilities on Washington Mutual and Athabasca Oil 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 Athabasca Oil. Check out your portfolio center. Please also check ongoing floating volatility patterns of Washington Mutual and Athabasca Oil.
Diversification Opportunities for Washington Mutual and Athabasca Oil
-0.12 | Correlation Coefficient |
Good diversification
The 3 months correlation between Washington and Athabasca is -0.12. Overlapping area represents the amount of risk that can be diversified away by holding Washington Mutual Investors and Athabasca Oil Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Athabasca Oil Corp 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 Athabasca Oil. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Athabasca Oil Corp has no effect on the direction of Washington Mutual i.e., Washington Mutual and Athabasca Oil go up and down completely randomly.
Pair Corralation between Washington Mutual and Athabasca Oil
Assuming the 90 days horizon Washington Mutual is expected to generate 4.18 times less return on investment than Athabasca Oil. But when comparing it to its historical volatility, Washington Mutual Investors is 3.18 times less risky than Athabasca Oil. It trades about 0.13 of its potential returns per unit of risk. Athabasca Oil Corp is currently generating about 0.17 of returns per unit of risk over similar time horizon. If you would invest 346.00 in Athabasca Oil Corp on October 23, 2024 and sell it today you would earn a total of 22.00 from holding Athabasca Oil Corp or generate 6.36% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Washington Mutual Investors vs. Athabasca Oil Corp
Performance |
| Timeline |
| Washington Mutual |
| Athabasca Oil Corp |
Washington Mutual and Athabasca Oil Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Washington Mutual and Athabasca Oil
The main advantage of trading using opposite Washington Mutual and Athabasca Oil positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Washington Mutual position performs unexpectedly, Athabasca Oil 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 Athabasca Oil will offset losses from the drop in Athabasca Oil'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 |
| Athabasca Oil vs. Pine Cliff Energy | Athabasca Oil vs. Cardinal Energy | Athabasca Oil vs. Tamarack Valley Energy | Athabasca Oil vs. Saturn Oil Gas |
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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
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