Correlation Between Sentinel Small and Washington Mutual
Can any of the company-specific risk be diversified away by investing in both Sentinel Small and Washington Mutual 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 Sentinel Small and Washington Mutual into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sentinel Small Pany and Washington Mutual Investors, you can compare the effects of market volatilities on Sentinel Small and Washington Mutual 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 Sentinel Small with a short position of Washington Mutual. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sentinel Small and Washington Mutual.
Diversification Opportunities for Sentinel Small and Washington Mutual
0.84 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Sentinel and Washington is 0.84. Overlapping area represents the amount of risk that can be diversified away by holding Sentinel Small Pany and Washington Mutual Investors in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Washington Mutual and Sentinel Small 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 Sentinel Small Pany are associated (or correlated) with Washington Mutual. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Washington Mutual has no effect on the direction of Sentinel Small i.e., Sentinel Small and Washington Mutual go up and down completely randomly.
Pair Corralation between Sentinel Small and Washington Mutual
Assuming the 90 days horizon Sentinel Small Pany is expected to generate 1.1 times more return on investment than Washington Mutual. However, Sentinel Small is 1.1 times more volatile than Washington Mutual Investors. It trades about 0.25 of its potential returns per unit of risk. Washington Mutual Investors is currently generating about 0.25 per unit of risk. If you would invest 692.00 in Sentinel Small Pany on October 20, 2024 and sell it today you would earn a total of 27.00 from holding Sentinel Small Pany or generate 3.9% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Strong |
Accuracy | 100.0% |
Values | Daily Returns |
Sentinel Small Pany vs. Washington Mutual Investors
Performance |
Timeline |
Sentinel Small Pany |
Washington Mutual |
Sentinel Small and Washington Mutual Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Sentinel Small and Washington Mutual
The main advantage of trading using opposite Sentinel Small and Washington Mutual positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sentinel Small position performs unexpectedly, Washington Mutual 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 Washington Mutual will offset losses from the drop in Washington Mutual's long position.Sentinel Small vs. Edward Jones Money | Sentinel Small vs. Hewitt Money Market | Sentinel Small vs. John Hancock Money | Sentinel Small vs. Cref Money Market |
Washington Mutual vs. Profunds Large Cap Growth | Washington Mutual vs. Ab Large Cap | Washington Mutual vs. Blackrock Large Cap | Washington Mutual vs. Qs Large Cap |
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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
Other Complementary Tools
Companies Directory Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals | |
Portfolio Comparator Compare the composition, asset allocations and performance of any two portfolios in your account | |
Options Analysis Analyze and evaluate options and option chains as a potential hedge for your portfolios | |
Portfolio Rebalancing Analyze risk-adjusted returns against different time horizons to find asset-allocation targets | |
Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets |