Correlation Between Thornburg Strategic and Old Westbury
Can any of the company-specific risk be diversified away by investing in both Thornburg Strategic and Old Westbury 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 Thornburg Strategic and Old Westbury into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Thornburg Strategic Municipal and Old Westbury Municipal, you can compare the effects of market volatilities on Thornburg Strategic and Old Westbury 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 Thornburg Strategic with a short position of Old Westbury. Check out your portfolio center. Please also check ongoing floating volatility patterns of Thornburg Strategic and Old Westbury.
Diversification Opportunities for Thornburg Strategic and Old Westbury
0.96 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Thornburg and Old is 0.96. Overlapping area represents the amount of risk that can be diversified away by holding Thornburg Strategic Municipal and Old Westbury Municipal in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Old Westbury Municipal and Thornburg Strategic 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 Thornburg Strategic Municipal are associated (or correlated) with Old Westbury. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Old Westbury Municipal has no effect on the direction of Thornburg Strategic i.e., Thornburg Strategic and Old Westbury go up and down completely randomly.
Pair Corralation between Thornburg Strategic and Old Westbury
Assuming the 90 days horizon Thornburg Strategic is expected to generate 3.01 times less return on investment than Old Westbury. In addition to that, Thornburg Strategic is 1.04 times more volatile than Old Westbury Municipal. It trades about 0.04 of its total potential returns per unit of risk. Old Westbury Municipal is currently generating about 0.13 per unit of volatility. If you would invest 1,142 in Old Westbury Municipal on November 3, 2024 and sell it today you would earn a total of 5.00 from holding Old Westbury Municipal or generate 0.44% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Thornburg Strategic Municipal vs. Old Westbury Municipal
Performance |
| Timeline |
| Thornburg Strategic |
| Old Westbury Municipal |
Thornburg Strategic and Old Westbury Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Thornburg Strategic and Old Westbury
The main advantage of trading using opposite Thornburg Strategic and Old Westbury positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Thornburg Strategic position performs unexpectedly, Old Westbury 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 Old Westbury will offset losses from the drop in Old Westbury's long position.| Thornburg Strategic vs. Thornburg Value Fund | Thornburg Strategic vs. Thornburg Value Fund | Thornburg Strategic vs. Thornburg New York | Thornburg Strategic vs. Thornburg International Value |
| Old Westbury vs. Rbb Fund | Old Westbury vs. Morningstar Global Income | Old Westbury vs. Dws Global Macro | Old Westbury vs. Ab Global Bond |
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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