Correlation Between Western Asset and APPLE
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By analyzing existing cross correlation between Western Asset Investment and APPLE INC, you can compare the effects of market volatilities on Western Asset and APPLE 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 APPLE. Check out your portfolio center. Please also check ongoing floating volatility patterns of Western Asset and APPLE.
Diversification Opportunities for Western Asset and APPLE
0.77 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Western and APPLE is 0.77. Overlapping area represents the amount of risk that can be diversified away by holding Western Asset Investment and APPLE INC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on APPLE INC 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 APPLE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of APPLE INC has no effect on the direction of Western Asset i.e., Western Asset and APPLE go up and down completely randomly.
Pair Corralation between Western Asset and APPLE
Considering the 90-day investment horizon Western Asset Investment is expected to generate 0.46 times more return on investment than APPLE. However, Western Asset Investment is 2.18 times less risky than APPLE. It trades about 0.04 of its potential returns per unit of risk. APPLE INC is currently generating about -0.02 per unit of risk. If you would invest 1,598 in Western Asset Investment on September 4, 2024 and sell it today you would earn a total of 85.00 from holding Western Asset Investment or generate 5.32% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 99.19% |
| Values | Daily Returns |
Western Asset Investment vs. APPLE INC
Performance |
| Timeline |
| Western Asset Investment |
| APPLE INC |
Western Asset and APPLE Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Western Asset and APPLE
The main advantage of trading using opposite Western Asset and APPLE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Western Asset position performs unexpectedly, APPLE 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 APPLE will offset losses from the drop in APPLE'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 |
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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 Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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