Correlation Between Touchstone Large and Teton Westwood
Can any of the company-specific risk be diversified away by investing in both Touchstone Large and Teton Westwood 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 Touchstone Large and Teton Westwood into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Touchstone Large Cap and Teton Westwood Balanced, you can compare the effects of market volatilities on Touchstone Large and Teton Westwood 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 Touchstone Large with a short position of Teton Westwood. Check out your portfolio center. Please also check ongoing floating volatility patterns of Touchstone Large and Teton Westwood.
Diversification Opportunities for Touchstone Large and Teton Westwood
0.05 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Touchstone and Teton is 0.05. Overlapping area represents the amount of risk that can be diversified away by holding Touchstone Large Cap and Teton Westwood Balanced in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Teton Westwood Balanced and Touchstone Large 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 Touchstone Large Cap are associated (or correlated) with Teton Westwood. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Teton Westwood Balanced has no effect on the direction of Touchstone Large i.e., Touchstone Large and Teton Westwood go up and down completely randomly.
Pair Corralation between Touchstone Large and Teton Westwood
Assuming the 90 days horizon Touchstone Large Cap is expected to generate 0.36 times more return on investment than Teton Westwood. However, Touchstone Large Cap is 2.74 times less risky than Teton Westwood. It trades about -0.09 of its potential returns per unit of risk. Teton Westwood Balanced is currently generating about -0.23 per unit of risk. If you would invest 2,040 in Touchstone Large Cap on September 12, 2024 and sell it today you would lose (19.00) from holding Touchstone Large Cap or give up 0.93% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Touchstone Large Cap vs. Teton Westwood Balanced
Performance |
| Timeline |
| Touchstone Large Cap |
| Teton Westwood Balanced |
Touchstone Large and Teton Westwood Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Touchstone Large and Teton Westwood
The main advantage of trading using opposite Touchstone Large and Teton Westwood positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Touchstone Large position performs unexpectedly, Teton Westwood 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 Teton Westwood will offset losses from the drop in Teton Westwood's long position.| Touchstone Large vs. Jhancock Disciplined Value | Touchstone Large vs. Fidelity Series 1000 | Touchstone Large vs. Dana Large Cap | Touchstone Large vs. Americafirst Large Cap |
| Teton Westwood vs. Lord Abbett Affiliated | Teton Westwood vs. Touchstone Large Cap | Teton Westwood vs. Dana Large Cap | Teton Westwood 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 Portfolio File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
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