Correlation Between American Balanced and Osterweis Strategic
Can any of the company-specific risk be diversified away by investing in both American Balanced and Osterweis Strategic 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 American Balanced and Osterweis Strategic into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between American Balanced Fund and Osterweis Strategic Investment, you can compare the effects of market volatilities on American Balanced and Osterweis Strategic 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 American Balanced with a short position of Osterweis Strategic. Check out your portfolio center. Please also check ongoing floating volatility patterns of American Balanced and Osterweis Strategic.
Diversification Opportunities for American Balanced and Osterweis Strategic
0.99 | Correlation Coefficient |
No risk reduction
The 3 months correlation between American and Osterweis is 0.99. Overlapping area represents the amount of risk that can be diversified away by holding American Balanced Fund and Osterweis Strategic Investment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Osterweis Strategic and American Balanced 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 American Balanced Fund are associated (or correlated) with Osterweis Strategic. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Osterweis Strategic has no effect on the direction of American Balanced i.e., American Balanced and Osterweis Strategic go up and down completely randomly.
Pair Corralation between American Balanced and Osterweis Strategic
Assuming the 90 days horizon American Balanced Fund is expected to generate 0.83 times more return on investment than Osterweis Strategic. However, American Balanced Fund is 1.21 times less risky than Osterweis Strategic. It trades about -0.08 of its potential returns per unit of risk. Osterweis Strategic Investment is currently generating about -0.13 per unit of risk. If you would invest 3,579 in American Balanced Fund on October 22, 2024 and sell it today you would lose (108.00) from holding American Balanced Fund or give up 3.02% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
American Balanced Fund vs. Osterweis Strategic Investment
Performance |
| Timeline |
| American Balanced |
| Osterweis Strategic |
American Balanced and Osterweis Strategic Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with American Balanced and Osterweis Strategic
The main advantage of trading using opposite American Balanced and Osterweis Strategic positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if American Balanced position performs unexpectedly, Osterweis Strategic 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 Osterweis Strategic will offset losses from the drop in Osterweis Strategic's long position.| American Balanced vs. Dunham High Yield | American Balanced vs. Aqr Risk Parity | American Balanced vs. Ab High Income | American Balanced vs. Barings High Yield |
| Osterweis Strategic vs. American Funds American | Osterweis Strategic vs. American Funds American | Osterweis Strategic vs. American Balanced | Osterweis Strategic vs. American Balanced Fund |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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