Correlation Between Legg Mason and Siit Ultra
Can any of the company-specific risk be diversified away by investing in both Legg Mason and Siit Ultra 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 Legg Mason and Siit Ultra into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Legg Mason Partners and Siit Ultra Short, you can compare the effects of market volatilities on Legg Mason and Siit Ultra 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 Legg Mason with a short position of Siit Ultra. Check out your portfolio center. Please also check ongoing floating volatility patterns of Legg Mason and Siit Ultra.
Diversification Opportunities for Legg Mason and Siit Ultra
0.78 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Legg and Siit is 0.78. Overlapping area represents the amount of risk that can be diversified away by holding Legg Mason Partners and Siit Ultra Short in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Siit Ultra Short and Legg Mason 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 Legg Mason Partners are associated (or correlated) with Siit Ultra. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Siit Ultra Short has no effect on the direction of Legg Mason i.e., Legg Mason and Siit Ultra go up and down completely randomly.
Pair Corralation between Legg Mason and Siit Ultra
If you would invest 2,348 in Legg Mason Partners on September 1, 2024 and sell it today you would earn a total of 119.00 from holding Legg Mason Partners or generate 5.07% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.45% |
| Values | Daily Returns |
Legg Mason Partners vs. Siit Ultra Short
Performance |
| Timeline |
| Legg Mason Partners |
| Siit Ultra Short |
Legg Mason and Siit Ultra Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Legg Mason and Siit Ultra
The main advantage of trading using opposite Legg Mason and Siit Ultra positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Legg Mason position performs unexpectedly, Siit Ultra 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 Siit Ultra will offset losses from the drop in Siit Ultra's long position.| Legg Mason vs. Siit Ultra Short | Legg Mason vs. Franklin Federal Limited Term | Legg Mason vs. The Short Term | Legg Mason vs. Maryland Short Term Tax Free |
| Siit Ultra vs. T Rowe Price | Siit Ultra vs. Chase Growth Fund | Siit Ultra vs. Eip Growth And | Siit Ultra vs. Qs Growth Fund |
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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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