Correlation Between Intal High and Western Asset
Can any of the company-specific risk be diversified away by investing in both Intal High and Western Asset 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 Intal High and Western Asset into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Intal High Relative and Western Asset High, you can compare the effects of market volatilities on Intal High and Western Asset 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 Intal High with a short position of Western Asset. Check out your portfolio center. Please also check ongoing floating volatility patterns of Intal High and Western Asset.
Diversification Opportunities for Intal High and Western Asset
-0.34 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Intal and Western is -0.34. Overlapping area represents the amount of risk that can be diversified away by holding Intal High Relative and Western Asset High in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Western Asset High and Intal High 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 Intal High Relative are associated (or correlated) with Western Asset. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Western Asset High has no effect on the direction of Intal High i.e., Intal High and Western Asset go up and down completely randomly.
Pair Corralation between Intal High and Western Asset
Assuming the 90 days horizon Intal High Relative is expected to under-perform the Western Asset. In addition to that, Intal High is 4.89 times more volatile than Western Asset High. It trades about -0.11 of its total potential returns per unit of risk. Western Asset High is currently generating about 0.13 per unit of volatility. If you would invest 702.00 in Western Asset High on September 13, 2024 and sell it today you would earn a total of 6.00 from holding Western Asset High or generate 0.85% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Intal High Relative vs. Western Asset High
Performance |
| Timeline |
| Intal High Relative |
| Western Asset High |
Intal High and Western Asset Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Intal High and Western Asset
The main advantage of trading using opposite Intal High and Western Asset positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Intal High position performs unexpectedly, Western Asset 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 Western Asset will offset losses from the drop in Western Asset's long position.| Intal High vs. Dfa International | Intal High vs. Dfa Inflation Protected | Intal High vs. Dfa International Small | Intal High vs. Dfa International |
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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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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