Correlation Between Western Asset and Sit Esg
Can any of the company-specific risk be diversified away by investing in both Western Asset and Sit Esg 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 Western Asset and Sit Esg into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Western Asset Inflation and Sit Esg Growth, you can compare the effects of market volatilities on Western Asset and Sit Esg 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 Western Asset with a short position of Sit Esg. Check out your portfolio center. Please also check ongoing floating volatility patterns of Western Asset and Sit Esg.
Diversification Opportunities for Western Asset and Sit Esg
-0.52 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Western and Sit is -0.52. Overlapping area represents the amount of risk that can be diversified away by holding Western Asset Inflation and Sit Esg Growth in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sit Esg Growth and Western Asset 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 Western Asset Inflation are associated (or correlated) with Sit Esg. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sit Esg Growth has no effect on the direction of Western Asset i.e., Western Asset and Sit Esg go up and down completely randomly.
Pair Corralation between Western Asset and Sit Esg
Assuming the 90 days horizon Western Asset is expected to generate 11.06 times less return on investment than Sit Esg. But when comparing it to its historical volatility, Western Asset Inflation is 1.94 times less risky than Sit Esg. It trades about 0.02 of its potential returns per unit of risk. Sit Esg Growth is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest 1,504 in Sit Esg Growth on August 30, 2024 and sell it today you would earn a total of 765.00 from holding Sit Esg Growth or generate 50.86% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Western Asset Inflation vs. Sit Esg Growth
Performance |
| Timeline |
| Western Asset Inflation |
| Sit Esg Growth |
Western Asset and Sit Esg Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Western Asset and Sit Esg
The main advantage of trading using opposite Western Asset and Sit Esg positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Western Asset position performs unexpectedly, Sit Esg 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 Sit Esg will offset losses from the drop in Sit Esg's long position.| Western Asset vs. Vanguard Inflation Protected Securities | Western Asset vs. HUMANA INC | Western Asset vs. Aquagold International | Western Asset vs. Barloworld Ltd ADR |
| Sit Esg vs. Precious Metals And | Sit Esg vs. Gamco Global Gold | Sit Esg vs. Goldman Sachs Centrated | Sit Esg vs. Gabelli Gold Fund |
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 Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
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