Correlation Between Westwood Short and Ancora/thelen Small-mid
Can any of the company-specific risk be diversified away by investing in both Westwood Short and Ancora/thelen Small-mid 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 Westwood Short and Ancora/thelen Small-mid into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Westwood Short Duration and Ancorathelen Small Mid Cap, you can compare the effects of market volatilities on Westwood Short and Ancora/thelen Small-mid 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 Westwood Short with a short position of Ancora/thelen Small-mid. Check out your portfolio center. Please also check ongoing floating volatility patterns of Westwood Short and Ancora/thelen Small-mid.
Diversification Opportunities for Westwood Short and Ancora/thelen Small-mid
0.88 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Westwood and Ancora/thelen is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding Westwood Short Duration and Ancorathelen Small Mid Cap in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ancora/thelen Small-mid and Westwood Short 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 Westwood Short Duration are associated (or correlated) with Ancora/thelen Small-mid. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ancora/thelen Small-mid has no effect on the direction of Westwood Short i.e., Westwood Short and Ancora/thelen Small-mid go up and down completely randomly.
Pair Corralation between Westwood Short and Ancora/thelen Small-mid
Assuming the 90 days horizon Westwood Short is expected to generate 4.86 times less return on investment than Ancora/thelen Small-mid. But when comparing it to its historical volatility, Westwood Short Duration is 3.9 times less risky than Ancora/thelen Small-mid. It trades about 0.18 of its potential returns per unit of risk. Ancorathelen Small Mid Cap is currently generating about 0.22 of returns per unit of risk over similar time horizon. If you would invest 1,971 in Ancorathelen Small Mid Cap on September 3, 2024 and sell it today you would earn a total of 303.00 from holding Ancorathelen Small Mid Cap or generate 15.37% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Westwood Short Duration vs. Ancorathelen Small Mid Cap
Performance |
| Timeline |
| Westwood Short Duration |
| Ancora/thelen Small-mid |
Westwood Short and Ancora/thelen Small-mid Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Westwood Short and Ancora/thelen Small-mid
The main advantage of trading using opposite Westwood Short and Ancora/thelen Small-mid positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Westwood Short position performs unexpectedly, Ancora/thelen Small-mid 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 Ancora/thelen Small-mid will offset losses from the drop in Ancora/thelen Small-mid's long position.| Westwood Short vs. Ancorathelen Small Mid Cap | Westwood Short vs. Rbb Fund | Westwood Short vs. Ab Small Cap | Westwood Short vs. Tax Managed Mid Small |
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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
Other Complementary Tools
| Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk | |
| My Watchlist Analysis Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like | |
| Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios | |
| Bollinger Bands Use Bollinger Bands indicator to analyze target price for a given investing horizon | |
| Economic Indicators Top statistical indicators that provide insights into how an economy is performing |