Correlation Between Western Asset and Ameriprise Financial
Can any of the company-specific risk be diversified away by investing in both Western Asset and Ameriprise Financial 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 Western Asset and Ameriprise Financial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Western Asset Investment and Ameriprise Financial, you can compare the effects of market volatilities on Western Asset and Ameriprise Financial 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 Western Asset with a short position of Ameriprise Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Western Asset and Ameriprise Financial.
Diversification Opportunities for Western Asset and Ameriprise Financial
-0.84 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Western and Ameriprise is -0.84. Overlapping area represents the amount of risk that can be diversified away by holding Western Asset Investment and Ameriprise Financial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ameriprise Financial and Western Asset 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 Western Asset Investment are associated (or correlated) with Ameriprise Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ameriprise Financial has no effect on the direction of Western Asset i.e., Western Asset and Ameriprise Financial go up and down completely randomly.
Pair Corralation between Western Asset and Ameriprise Financial
Considering the 90-day investment horizon Western Asset Investment is expected to generate 0.36 times more return on investment than Ameriprise Financial. However, Western Asset Investment is 2.79 times less risky than Ameriprise Financial. It trades about 0.1 of its potential returns per unit of risk. Ameriprise Financial is currently generating about -0.21 per unit of risk. If you would invest 1,660 in Western Asset Investment on September 20, 2024 and sell it today you would earn a total of 10.00 from holding Western Asset Investment or generate 0.6% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Western Asset Investment vs. Ameriprise Financial
Performance |
| Timeline |
| Western Asset Investment |
| Ameriprise Financial |
Western Asset and Ameriprise Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Western Asset and Ameriprise Financial
The main advantage of trading using opposite Western Asset and Ameriprise Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Western Asset position performs unexpectedly, Ameriprise Financial 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 Ameriprise Financial will offset losses from the drop in Ameriprise Financial's long position.| Western Asset vs. Pioneer Floating Rate | Western Asset vs. The Gabelli Equity | Western Asset vs. Pioneer Municipal High | Western Asset vs. Nuveen Global High |
| Ameriprise Financial vs. Visa Class A | Ameriprise Financial vs. Deutsche Bank AG | Ameriprise Financial vs. Dynex Capital |
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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
Other Complementary Tools
| USA ETFs Find actively traded Exchange Traded Funds (ETF) in USA | |
| Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas | |
| Commodity Channel Use Commodity Channel Index to analyze current equity momentum | |
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine | |
| Portfolio Comparator Compare the composition, asset allocations and performance of any two portfolios in your account |