Correlation Between Shenkman Floating and Metropolitan West
Can any of the company-specific risk be diversified away by investing in both Shenkman Floating and Metropolitan West 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 Shenkman Floating and Metropolitan West into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Shenkman Floating Rate and Metropolitan West Porate, you can compare the effects of market volatilities on Shenkman Floating and Metropolitan West 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 Shenkman Floating with a short position of Metropolitan West. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shenkman Floating and Metropolitan West.
Diversification Opportunities for Shenkman Floating and Metropolitan West
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Shenkman and Metropolitan is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Shenkman Floating Rate and Metropolitan West Porate in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Metropolitan West Porate and Shenkman Floating 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 Shenkman Floating Rate are associated (or correlated) with Metropolitan West. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Metropolitan West Porate has no effect on the direction of Shenkman Floating i.e., Shenkman Floating and Metropolitan West go up and down completely randomly.
Pair Corralation between Shenkman Floating and Metropolitan West
Assuming the 90 days horizon Shenkman Floating Rate is expected to generate 0.36 times more return on investment than Metropolitan West. However, Shenkman Floating Rate is 2.78 times less risky than Metropolitan West. It trades about 0.49 of its potential returns per unit of risk. Metropolitan West Porate is currently generating about -0.02 per unit of risk. If you would invest 892.00 in Shenkman Floating Rate on November 2, 2024 and sell it today you would earn a total of 30.00 from holding Shenkman Floating Rate or generate 3.36% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 99.04% |
| Values | Daily Returns |
Shenkman Floating Rate vs. Metropolitan West Porate
Performance |
| Timeline |
| Shenkman Floating Rate |
| Metropolitan West Porate |
Shenkman Floating and Metropolitan West Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shenkman Floating and Metropolitan West
The main advantage of trading using opposite Shenkman Floating and Metropolitan West positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shenkman Floating position performs unexpectedly, Metropolitan West 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 Metropolitan West will offset losses from the drop in Metropolitan West's long position.| Shenkman Floating vs. Absolute Convertible Arbitrage | Shenkman Floating vs. Allianzgi Convertible Income | Shenkman Floating vs. Fidelity Sai Convertible | Shenkman Floating vs. Rationalpier 88 Convertible |
| Metropolitan West vs. Ab Bond Inflation | Metropolitan West vs. Bbh Intermediate Municipal | Metropolitan West vs. Rbc Ultra Short Fixed | Metropolitan West vs. Inflation Adjusted Bond 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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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