Correlation Between 1290 Funds and Old Westbury
Can any of the company-specific risk be diversified away by investing in both 1290 Funds and Old Westbury 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 1290 Funds and Old Westbury into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between 1290 Funds and Old Westbury Short Term, you can compare the effects of market volatilities on 1290 Funds and Old Westbury 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 1290 Funds with a short position of Old Westbury. Check out your portfolio center. Please also check ongoing floating volatility patterns of 1290 Funds and Old Westbury.
Diversification Opportunities for 1290 Funds and Old Westbury
-0.35 | Correlation Coefficient |
Very good diversification
The 3 months correlation between 1290 and Old is -0.35. Overlapping area represents the amount of risk that can be diversified away by holding 1290 Funds and Old Westbury Short Term in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Old Westbury Short and 1290 Funds 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 1290 Funds are associated (or correlated) with Old Westbury. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Old Westbury Short has no effect on the direction of 1290 Funds i.e., 1290 Funds and Old Westbury go up and down completely randomly.
Pair Corralation between 1290 Funds and Old Westbury
Assuming the 90 days horizon 1290 Funds is expected to generate 15.11 times more return on investment than Old Westbury. However, 1290 Funds is 15.11 times more volatile than Old Westbury Short Term. It trades about 0.31 of its potential returns per unit of risk. Old Westbury Short Term is currently generating about 0.16 per unit of risk. If you would invest 1,213 in 1290 Funds on September 4, 2024 and sell it today you would earn a total of 140.00 from holding 1290 Funds or generate 11.54% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
1290 Funds vs. Old Westbury Short Term
Performance |
| Timeline |
| 1290 Funds |
| Old Westbury Short |
1290 Funds and Old Westbury Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with 1290 Funds and Old Westbury
The main advantage of trading using opposite 1290 Funds and Old Westbury positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if 1290 Funds position performs unexpectedly, Old Westbury 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 Old Westbury will offset losses from the drop in Old Westbury's long position.| 1290 Funds vs. 1290 Essex Small | 1290 Funds vs. 1290 Smartbeta Equity | 1290 Funds vs. 1290 Smartbeta Equity | 1290 Funds vs. 1290 Smartbeta Equity |
| Old Westbury vs. Old Westbury All | Old Westbury vs. Old Westbury Credit | Old Westbury vs. Old Westbury Large | Old Westbury vs. Old Westbury Municipal |
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 Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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