Correlation Between Vy Baron and Westwood High
Can any of the company-specific risk be diversified away by investing in both Vy Baron and Westwood High 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 Vy Baron and Westwood High into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Vy Baron Growth and Westwood High Income, you can compare the effects of market volatilities on Vy Baron and Westwood High 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 Vy Baron with a short position of Westwood High. Check out your portfolio center. Please also check ongoing floating volatility patterns of Vy Baron and Westwood High.
Diversification Opportunities for Vy Baron and Westwood High
0.84 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between IBSSX and Westwood is 0.84. Overlapping area represents the amount of risk that can be diversified away by holding Vy Baron Growth and Westwood High Income in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Westwood High Income and Vy Baron 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 Vy Baron Growth are associated (or correlated) with Westwood High. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Westwood High Income has no effect on the direction of Vy Baron i.e., Vy Baron and Westwood High go up and down completely randomly.
Pair Corralation between Vy Baron and Westwood High
Assuming the 90 days horizon Vy Baron is expected to generate 1.45 times less return on investment than Westwood High. In addition to that, Vy Baron is 3.03 times more volatile than Westwood High Income. It trades about 0.04 of its total potential returns per unit of risk. Westwood High Income is currently generating about 0.18 per unit of volatility. If you would invest 882.00 in Westwood High Income on September 14, 2024 and sell it today you would earn a total of 139.00 from holding Westwood High Income or generate 15.76% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 99.63% |
| Values | Daily Returns |
Vy Baron Growth vs. Westwood High Income
Performance |
| Timeline |
| Vy Baron Growth |
| Westwood High Income |
Vy Baron and Westwood High Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Vy Baron and Westwood High
The main advantage of trading using opposite Vy Baron and Westwood High positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Vy Baron position performs unexpectedly, Westwood High 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 Westwood High will offset losses from the drop in Westwood High's long position.| Vy Baron vs. Voya Bond Index | Vy Baron vs. Voya Bond Index | Vy Baron vs. Voya Limited Maturity | Vy Baron vs. Voya Limited Maturity |
| Westwood High vs. T Rowe Price | Westwood High vs. Tfa Alphagen Growth | Westwood High vs. Vy Baron Growth | Westwood High vs. Artisan Small Cap |
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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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