Correlation Between Washington Mutual and Janus Flexible
Can any of the company-specific risk be diversified away by investing in both Washington Mutual and Janus Flexible 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 Washington Mutual and Janus Flexible into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Washington Mutual Investors and Janus Flexible Bond, you can compare the effects of market volatilities on Washington Mutual and Janus Flexible 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 Washington Mutual with a short position of Janus Flexible. Check out your portfolio center. Please also check ongoing floating volatility patterns of Washington Mutual and Janus Flexible.
Diversification Opportunities for Washington Mutual and Janus Flexible
-0.57 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Washington and Janus is -0.57. Overlapping area represents the amount of risk that can be diversified away by holding Washington Mutual Investors and Janus Flexible Bond in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Janus Flexible Bond and Washington Mutual 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 Washington Mutual Investors are associated (or correlated) with Janus Flexible. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Janus Flexible Bond has no effect on the direction of Washington Mutual i.e., Washington Mutual and Janus Flexible go up and down completely randomly.
Pair Corralation between Washington Mutual and Janus Flexible
Assuming the 90 days horizon Washington Mutual Investors is expected to generate 1.6 times more return on investment than Janus Flexible. However, Washington Mutual is 1.6 times more volatile than Janus Flexible Bond. It trades about 0.1 of its potential returns per unit of risk. Janus Flexible Bond is currently generating about 0.03 per unit of risk. If you would invest 4,687 in Washington Mutual Investors on August 26, 2024 and sell it today you would earn a total of 1,804 from holding Washington Mutual Investors or generate 38.49% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Washington Mutual Investors vs. Janus Flexible Bond
Performance |
| Timeline |
| Washington Mutual |
| Janus Flexible Bond |
Washington Mutual and Janus Flexible Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Washington Mutual and Janus Flexible
The main advantage of trading using opposite Washington Mutual and Janus Flexible positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Washington Mutual position performs unexpectedly, Janus Flexible 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 Janus Flexible will offset losses from the drop in Janus Flexible's long position.| Washington Mutual vs. Income Fund Of | Washington Mutual vs. New World Fund | Washington Mutual vs. American Mutual Fund | Washington Mutual vs. American Mutual Fund |
| Janus Flexible vs. Virtus Emerging Markets | Janus Flexible vs. Oppenheimer International Growth | Janus Flexible vs. Commodityrealreturn Strategy Fund | Janus Flexible vs. Mfs Value 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 Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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