Correlation Between Nationwide Fund6 and Western Asset
Can any of the company-specific risk be diversified away by investing in both Nationwide Fund6 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 Nationwide Fund6 and Western Asset into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Nationwide Fund6 and Western Asset Diversified, you can compare the effects of market volatilities on Nationwide Fund6 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 Nationwide Fund6 with a short position of Western Asset. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nationwide Fund6 and Western Asset.
Diversification Opportunities for Nationwide Fund6 and Western Asset
0.92 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Nationwide and Western is 0.92. Overlapping area represents the amount of risk that can be diversified away by holding Nationwide Fund6 and Western Asset Diversified in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Western Asset Diversified and Nationwide Fund6 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 Nationwide Fund6 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 Diversified has no effect on the direction of Nationwide Fund6 i.e., Nationwide Fund6 and Western Asset go up and down completely randomly.
Pair Corralation between Nationwide Fund6 and Western Asset
Assuming the 90 days horizon Nationwide Fund6 is expected to under-perform the Western Asset. In addition to that, Nationwide Fund6 is 3.35 times more volatile than Western Asset Diversified. It trades about -0.09 of its total potential returns per unit of risk. Western Asset Diversified is currently generating about 0.06 per unit of volatility. If you would invest 1,520 in Western Asset Diversified on November 28, 2024 and sell it today you would earn a total of 4.00 from holding Western Asset Diversified or generate 0.26% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Nationwide Fund6 vs. Western Asset Diversified
Performance |
| Timeline |
| Nationwide Fund6 |
| Western Asset Diversified |
Nationwide Fund6 and Western Asset Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nationwide Fund6 and Western Asset
The main advantage of trading using opposite Nationwide Fund6 and Western Asset positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nationwide Fund6 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.| Nationwide Fund6 vs. Europac Gold Fund | Nationwide Fund6 vs. Gabelli Gold Fund | Nationwide Fund6 vs. Global Gold Fund | Nationwide Fund6 vs. Precious Metals And |
| Western Asset vs. T Rowe Price | Western Asset vs. Nationwide E Plus | Western Asset vs. Baird Quality Intermediate | Western Asset vs. Barings Active Short |
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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