Correlation Between Old Westbury and Saat Conservative
Can any of the company-specific risk be diversified away by investing in both Old Westbury and Saat Conservative 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 Saat Conservative into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Old Westbury Short Term and Saat Servative Strategy, you can compare the effects of market volatilities on Old Westbury and Saat Conservative 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 Saat Conservative. Check out your portfolio center. Please also check ongoing floating volatility patterns of Old Westbury and Saat Conservative.
Diversification Opportunities for Old Westbury and Saat Conservative
0.78 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Old and SAAT is 0.78. Overlapping area represents the amount of risk that can be diversified away by holding Old Westbury Short Term and Saat Servative Strategy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Saat Servative Strategy 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 Short Term are associated (or correlated) with Saat Conservative. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Saat Servative Strategy has no effect on the direction of Old Westbury i.e., Old Westbury and Saat Conservative go up and down completely randomly.
Pair Corralation between Old Westbury and Saat Conservative
Assuming the 90 days horizon Old Westbury is expected to generate 1.04 times less return on investment than Saat Conservative. But when comparing it to its historical volatility, Old Westbury Short Term is 1.9 times less risky than Saat Conservative. It trades about 0.18 of its potential returns per unit of risk. Saat Servative Strategy is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest 951.00 in Saat Servative Strategy on September 1, 2024 and sell it today you would earn a total of 106.00 from holding Saat Servative Strategy or generate 11.15% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 38.31% |
| Values | Daily Returns |
Old Westbury Short Term vs. Saat Servative Strategy
Performance |
| Timeline |
| Old Westbury Short |
| Saat Servative Strategy |
Old Westbury and Saat Conservative Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Old Westbury and Saat Conservative
The main advantage of trading using opposite Old Westbury and Saat Conservative positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Old Westbury position performs unexpectedly, Saat Conservative 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 Saat Conservative will offset losses from the drop in Saat Conservative's long position.The idea behind Old Westbury Short Term and Saat Servative Strategy pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
| Saat Conservative vs. Old Westbury Short Term | Saat Conservative vs. Franklin Federal Limited Term | Saat Conservative vs. The Short Term | Saat Conservative vs. Sterling Capital 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 CEOs Directory module to screen CEOs from public companies around the world.
Other Complementary Tools
| Sync Your Broker Sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors. | |
| Money Managers Screen money managers from public funds and ETFs managed around the world | |
| Portfolio File Import Quickly import all of your third-party portfolios from your local drive in csv format | |
| Price Transformation Use Price Transformation models to analyze the depth of different equity instruments across global markets | |
| Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings |