Correlation Between Old Westbury and Kellner Merger
Can any of the company-specific risk be diversified away by investing in both Old Westbury and Kellner Merger 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 Kellner Merger 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 Kellner Merger Fund, you can compare the effects of market volatilities on Old Westbury and Kellner Merger 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 Kellner Merger. Check out your portfolio center. Please also check ongoing floating volatility patterns of Old Westbury and Kellner Merger.
Diversification Opportunities for Old Westbury and Kellner Merger
0.46 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Old and Kellner is 0.46. Overlapping area represents the amount of risk that can be diversified away by holding Old Westbury Municipal and Kellner Merger Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kellner Merger 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 Kellner Merger. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kellner Merger has no effect on the direction of Old Westbury i.e., Old Westbury and Kellner Merger go up and down completely randomly.
Pair Corralation between Old Westbury and Kellner Merger
Assuming the 90 days horizon Old Westbury Municipal is expected to generate 0.55 times more return on investment than Kellner Merger. However, Old Westbury Municipal is 1.81 times less risky than Kellner Merger. It trades about 0.07 of its potential returns per unit of risk. Kellner Merger Fund is currently generating about 0.02 per unit of risk. If you would invest 1,099 in Old Westbury Municipal on September 14, 2024 and sell it today you would earn a total of 62.00 from holding Old Westbury Municipal or generate 5.64% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Old Westbury Municipal vs. Kellner Merger Fund
Performance |
| Timeline |
| Old Westbury Municipal |
| Kellner Merger |
Old Westbury and Kellner Merger Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Old Westbury and Kellner Merger
The main advantage of trading using opposite Old Westbury and Kellner Merger positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Old Westbury position performs unexpectedly, Kellner Merger 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 Kellner Merger will offset losses from the drop in Kellner Merger'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 |
| Kellner Merger vs. Old Westbury Municipal | Kellner Merger vs. Morningstar Municipal Bond | Kellner Merger vs. Nuveen Minnesota Municipal | Kellner Merger vs. Baird Strategic Municipal |
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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