Correlation Between Washington Mutual and Bank Ocbc
Can any of the company-specific risk be diversified away by investing in both Washington Mutual and Bank Ocbc 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 Bank Ocbc 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 Bank Ocbc Nisp, you can compare the effects of market volatilities on Washington Mutual and Bank Ocbc 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 Bank Ocbc. Check out your portfolio center. Please also check ongoing floating volatility patterns of Washington Mutual and Bank Ocbc.
Diversification Opportunities for Washington Mutual and Bank Ocbc
0.59 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Washington and Bank is 0.59. Overlapping area represents the amount of risk that can be diversified away by holding Washington Mutual Investors and Bank Ocbc Nisp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bank Ocbc Nisp 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 Bank Ocbc. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bank Ocbc Nisp has no effect on the direction of Washington Mutual i.e., Washington Mutual and Bank Ocbc go up and down completely randomly.
Pair Corralation between Washington Mutual and Bank Ocbc
Assuming the 90 days horizon Washington Mutual Investors is expected to generate 0.84 times more return on investment than Bank Ocbc. However, Washington Mutual Investors is 1.19 times less risky than Bank Ocbc. It trades about 0.25 of its potential returns per unit of risk. Bank Ocbc Nisp is currently generating about -0.05 per unit of risk. If you would invest 6,196 in Washington Mutual Investors on November 4, 2024 and sell it today you would earn a total of 205.00 from holding Washington Mutual Investors or generate 3.31% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.0% |
| Values | Daily Returns |
Washington Mutual Investors vs. Bank Ocbc Nisp
Performance |
| Timeline |
| Washington Mutual |
| Bank Ocbc Nisp |
Washington Mutual and Bank Ocbc Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Washington Mutual and Bank Ocbc
The main advantage of trading using opposite Washington Mutual and Bank Ocbc positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Washington Mutual position performs unexpectedly, Bank Ocbc 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 Bank Ocbc will offset losses from the drop in Bank Ocbc's long position.| Washington Mutual vs. Neuberger Berman Real | Washington Mutual vs. Dunham Real Estate | Washington Mutual vs. Real Estate Ultrasector | Washington Mutual vs. Texton Property |
| Bank Ocbc vs. Bank Mega Tbk | Bank Ocbc vs. Bank Pan Indonesia | Bank Ocbc vs. Bank Permata Tbk | Bank Ocbc vs. Bank Cimb Niaga |
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 Portfolio Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
Other Complementary Tools
| Portfolio Center All portfolio management and optimization tools to improve performance of your portfolios | |
| Risk-Return Analysis View associations between returns expected from investment and the risk you assume | |
| ETFs Find actively traded Exchange Traded Funds (ETF) from around the world | |
| Watchlist Optimization Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm | |
| Stocks Directory Find actively traded stocks across global markets |