Correlation Between Old Westbury and Allianzgi Emerging
Can any of the company-specific risk be diversified away by investing in both Old Westbury and Allianzgi Emerging 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 Old Westbury and Allianzgi Emerging into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Old Westbury Municipal and Allianzgi Emerging Markets, you can compare the effects of market volatilities on Old Westbury and Allianzgi Emerging 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 Old Westbury with a short position of Allianzgi Emerging. Check out your portfolio center. Please also check ongoing floating volatility patterns of Old Westbury and Allianzgi Emerging.
Diversification Opportunities for Old Westbury and Allianzgi Emerging
-0.05 | Correlation Coefficient |
Good diversification
The 3 months correlation between Old and Allianzgi is -0.05. Overlapping area represents the amount of risk that can be diversified away by holding Old Westbury Municipal and Allianzgi Emerging Markets in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Allianzgi Emerging and Old Westbury 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 Old Westbury Municipal are associated (or correlated) with Allianzgi Emerging. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Allianzgi Emerging has no effect on the direction of Old Westbury i.e., Old Westbury and Allianzgi Emerging go up and down completely randomly.
Pair Corralation between Old Westbury and Allianzgi Emerging
Assuming the 90 days horizon Old Westbury is expected to generate 4.29 times less return on investment than Allianzgi Emerging. But when comparing it to its historical volatility, Old Westbury Municipal is 4.73 times less risky than Allianzgi Emerging. It trades about 0.06 of its potential returns per unit of risk. Allianzgi Emerging Markets is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 2,420 in Allianzgi Emerging Markets on September 2, 2024 and sell it today you would earn a total of 533.00 from holding Allianzgi Emerging Markets or generate 22.02% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Old Westbury Municipal vs. Allianzgi Emerging Markets
Performance |
| Timeline |
| Old Westbury Municipal |
| Allianzgi Emerging |
Old Westbury and Allianzgi Emerging Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Old Westbury and Allianzgi Emerging
The main advantage of trading using opposite Old Westbury and Allianzgi Emerging positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Old Westbury position performs unexpectedly, Allianzgi Emerging 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 Allianzgi Emerging will offset losses from the drop in Allianzgi Emerging's long position.| Old Westbury vs. Old Westbury All | Old Westbury vs. Old Westbury California | Old Westbury vs. Old Westbury Credit | Old Westbury vs. Old Westbury Fixed |
| Allianzgi Emerging vs. Old Westbury Large | Allianzgi Emerging vs. Legg Mason Bw | Allianzgi Emerging vs. T Rowe Price | Allianzgi Emerging vs. Alternative Asset Allocation |
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 Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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