Correlation Between Wesmark Tactical and Wesmark Balanced
Can any of the company-specific risk be diversified away by investing in both Wesmark Tactical and Wesmark Balanced 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 Wesmark Tactical and Wesmark Balanced into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Wesmark Tactical Opportunity and Wesmark Balanced Fund, you can compare the effects of market volatilities on Wesmark Tactical and Wesmark Balanced 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 Wesmark Tactical with a short position of Wesmark Balanced. Check out your portfolio center. Please also check ongoing floating volatility patterns of Wesmark Tactical and Wesmark Balanced.
Diversification Opportunities for Wesmark Tactical and Wesmark Balanced
0.9 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Wesmark and Wesmark is 0.9. Overlapping area represents the amount of risk that can be diversified away by holding Wesmark Tactical Opportunity and Wesmark Balanced Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Wesmark Balanced and Wesmark Tactical 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 Wesmark Tactical Opportunity are associated (or correlated) with Wesmark Balanced. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Wesmark Balanced has no effect on the direction of Wesmark Tactical i.e., Wesmark Tactical and Wesmark Balanced go up and down completely randomly.
Pair Corralation between Wesmark Tactical and Wesmark Balanced
Assuming the 90 days horizon Wesmark Tactical Opportunity is expected to generate 0.85 times more return on investment than Wesmark Balanced. However, Wesmark Tactical Opportunity is 1.18 times less risky than Wesmark Balanced. It trades about 0.18 of its potential returns per unit of risk. Wesmark Balanced Fund is currently generating about 0.14 per unit of risk. If you would invest 1,183 in Wesmark Tactical Opportunity on August 30, 2024 and sell it today you would earn a total of 21.00 from holding Wesmark Tactical Opportunity or generate 1.78% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Wesmark Tactical Opportunity vs. Wesmark Balanced Fund
Performance |
| Timeline |
| Wesmark Tactical Opp |
| Wesmark Balanced |
Wesmark Tactical and Wesmark Balanced Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Wesmark Tactical and Wesmark Balanced
The main advantage of trading using opposite Wesmark Tactical and Wesmark Balanced positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Wesmark Tactical position performs unexpectedly, Wesmark Balanced 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 Wesmark Balanced will offset losses from the drop in Wesmark Balanced's long position.| Wesmark Tactical vs. Wesmark Growth Fund | Wesmark Tactical vs. Wesmark Government Bond | Wesmark Tactical vs. Wesmark Small Pany |
| Wesmark Balanced vs. Wesmark Growth Fund | Wesmark Balanced vs. Wesmark Government Bond | Wesmark Balanced vs. Wesmark Small Pany | Wesmark Balanced vs. Wesmark West Virginia |
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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
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