Correlation Between Integral and Western Asset
Can any of the company-specific risk be diversified away by investing in both Integral 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 Integral and Western Asset into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Integral Ad Science and Western Asset Investment, you can compare the effects of market volatilities on Integral 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 Integral with a short position of Western Asset. Check out your portfolio center. Please also check ongoing floating volatility patterns of Integral and Western Asset.
Diversification Opportunities for Integral and Western Asset
0.56 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Integral and Western is 0.56. Overlapping area represents the amount of risk that can be diversified away by holding Integral Ad Science and Western Asset Investment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Western Asset Investment and Integral 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 Integral Ad Science 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 Investment has no effect on the direction of Integral i.e., Integral and Western Asset go up and down completely randomly.
Pair Corralation between Integral and Western Asset
Considering the 90-day investment horizon Integral Ad Science is expected to under-perform the Western Asset. In addition to that, Integral is 3.34 times more volatile than Western Asset Investment. It trades about -0.05 of its total potential returns per unit of risk. Western Asset Investment is currently generating about 0.24 per unit of volatility. If you would invest 1,642 in Western Asset Investment on November 28, 2024 and sell it today you would earn a total of 32.00 from holding Western Asset Investment or generate 1.95% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Integral Ad Science vs. Western Asset Investment
Performance |
| Timeline |
| Integral Ad Science |
| Western Asset Investment |
Integral and Western Asset Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Integral and Western Asset
The main advantage of trading using opposite Integral and Western Asset positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Integral 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.The idea behind Integral Ad Science and Western Asset Investment pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Western Asset vs. Pioneer Floating Rate | Western Asset vs. The Gabelli Equity | Western Asset vs. Pioneer Municipal High | Western Asset vs. Nuveen Global High |
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 Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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