Correlation Between Washington Mutual and Muzinich Credit
Can any of the company-specific risk be diversified away by investing in both Washington Mutual and Muzinich Credit 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 Muzinich Credit 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 Muzinich Credit Opportunities, you can compare the effects of market volatilities on Washington Mutual and Muzinich Credit 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 Muzinich Credit. Check out your portfolio center. Please also check ongoing floating volatility patterns of Washington Mutual and Muzinich Credit.
Diversification Opportunities for Washington Mutual and Muzinich Credit
0.49 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Washington and Muzinich is 0.49. Overlapping area represents the amount of risk that can be diversified away by holding Washington Mutual Investors and Muzinich Credit Opportunities in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Muzinich Credit Oppo 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 Muzinich Credit. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Muzinich Credit Oppo has no effect on the direction of Washington Mutual i.e., Washington Mutual and Muzinich Credit go up and down completely randomly.
Pair Corralation between Washington Mutual and Muzinich Credit
Assuming the 90 days horizon Washington Mutual Investors is expected to generate 4.08 times more return on investment than Muzinich Credit. However, Washington Mutual is 4.08 times more volatile than Muzinich Credit Opportunities. It trades about 0.21 of its potential returns per unit of risk. Muzinich Credit Opportunities is currently generating about 0.12 per unit of risk. If you would invest 6,205 in Washington Mutual Investors on October 24, 2024 and sell it today you would earn a total of 173.00 from holding Washington Mutual Investors or generate 2.79% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 94.74% |
| Values | Daily Returns |
Washington Mutual Investors vs. Muzinich Credit Opportunities
Performance |
| Timeline |
| Washington Mutual |
| Muzinich Credit Oppo |
Washington Mutual and Muzinich Credit Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Washington Mutual and Muzinich Credit
The main advantage of trading using opposite Washington Mutual and Muzinich Credit positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Washington Mutual position performs unexpectedly, Muzinich Credit 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 Muzinich Credit will offset losses from the drop in Muzinich Credit's long position.| Washington Mutual vs. Alphacentric Symmetry Strategy | Washington Mutual vs. Barings Emerging Markets | Washington Mutual vs. Western Assets Emerging | Washington Mutual vs. Catalystmillburn Hedge Strategy |
| Muzinich Credit vs. Aig Government Money | Muzinich Credit vs. Ashmore Emerging Markets | Muzinich Credit vs. Jpmorgan Trust Iv | Muzinich Credit vs. Fidelity Government Money |
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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