Correlation Between Siit Global and Westwood Short
Can any of the company-specific risk be diversified away by investing in both Siit Global and Westwood Short 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 Siit Global and Westwood Short into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Siit Global Managed and Westwood Short Duration, you can compare the effects of market volatilities on Siit Global and Westwood Short 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 Siit Global with a short position of Westwood Short. Check out your portfolio center. Please also check ongoing floating volatility patterns of Siit Global and Westwood Short.
Diversification Opportunities for Siit Global and Westwood Short
0.66 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Siit and Westwood is 0.66. Overlapping area represents the amount of risk that can be diversified away by holding Siit Global Managed and Westwood Short Duration in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Westwood Short Duration and Siit Global 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 Siit Global Managed are associated (or correlated) with Westwood Short. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Westwood Short Duration has no effect on the direction of Siit Global i.e., Siit Global and Westwood Short go up and down completely randomly.
Pair Corralation between Siit Global and Westwood Short
Assuming the 90 days horizon Siit Global is expected to generate 2.2 times less return on investment than Westwood Short. In addition to that, Siit Global is 1.98 times more volatile than Westwood Short Duration. It trades about 0.02 of its total potential returns per unit of risk. Westwood Short Duration is currently generating about 0.09 per unit of volatility. If you would invest 860.00 in Westwood Short Duration on October 7, 2024 and sell it today you would earn a total of 139.00 from holding Westwood Short Duration or generate 16.16% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Siit Global Managed vs. Westwood Short Duration
Performance |
| Timeline |
| Siit Global Managed |
| Westwood Short Duration |
Siit Global and Westwood Short Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Siit Global and Westwood Short
The main advantage of trading using opposite Siit Global and Westwood Short positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Siit Global position performs unexpectedly, Westwood Short 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 Westwood Short will offset losses from the drop in Westwood Short's long position.| Siit Global vs. Franklin Mutual Global | Siit Global vs. Dodge Global Stock | Siit Global vs. Franklin Mutual Global | Siit Global vs. T Rowe Price |
| Westwood Short vs. Fidelity Asset Manager | Westwood Short vs. Fidelity Asset Manager | Westwood Short vs. Fidelity Asset Manager | Westwood Short vs. Fidelity Asset Manager |
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 Dashboard module to portfolio dashboard that provides centralized access to all your investments.
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