Correlation Between Liberty All and Western Asset
Can any of the company-specific risk be diversified away by investing in both Liberty All and Western Asset 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 Liberty All and Western Asset into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Liberty All Star and Western Asset Municipal, you can compare the effects of market volatilities on Liberty All and Western Asset 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 Liberty All with a short position of Western Asset. Check out your portfolio center. Please also check ongoing floating volatility patterns of Liberty All and Western Asset.
Diversification Opportunities for Liberty All and Western Asset
0.09 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Liberty and Western is 0.09. Overlapping area represents the amount of risk that can be diversified away by holding Liberty All Star and Western Asset Municipal in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Western Asset Municipal and Liberty All 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 Liberty All Star are associated (or correlated) with Western Asset. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Western Asset Municipal has no effect on the direction of Liberty All i.e., Liberty All and Western Asset go up and down completely randomly.
Pair Corralation between Liberty All and Western Asset
If you would invest 637.00 in Liberty All Star on August 31, 2024 and sell it today you would earn a total of 93.00 from holding Liberty All Star or generate 14.6% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 0.79% |
| Values | Daily Returns |
Liberty All Star vs. Western Asset Municipal
Performance |
| Timeline |
| Liberty All Star |
| Western Asset Municipal |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Liberty All and Western Asset Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Liberty All and Western Asset
The main advantage of trading using opposite Liberty All and Western Asset positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Liberty All position performs unexpectedly, Western Asset 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 Western Asset will offset losses from the drop in Western Asset's long position.| Liberty All vs. Adams Diversified Equity | Liberty All vs. BlackRock Science and | Liberty All vs. Virtus Allianzgi Artificial | Liberty All vs. Royce Value Closed |
| Western Asset vs. Eagle Point Income | Western Asset vs. Nuveen New York | Western Asset vs. MFS High Income | Western Asset vs. MFS High Yield |
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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
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