Correlation Between Washington Mutual and American Independence
Can any of the company-specific risk be diversified away by investing in both Washington Mutual and American Independence 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 American Independence 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 American Independence Kansas, you can compare the effects of market volatilities on Washington Mutual and American Independence 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 American Independence. Check out your portfolio center. Please also check ongoing floating volatility patterns of Washington Mutual and American Independence.
Diversification Opportunities for Washington Mutual and American Independence
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Washington and American is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Washington Mutual Investors and American Independence Kansas in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on American Independence 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 American Independence. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of American Independence has no effect on the direction of Washington Mutual i.e., Washington Mutual and American Independence go up and down completely randomly.
Pair Corralation between Washington Mutual and American Independence
If you would invest 5,036 in Washington Mutual Investors on September 13, 2024 and sell it today you would earn a total of 1,469 from holding Washington Mutual Investors or generate 29.17% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 0.0% |
| Values | Daily Returns |
Washington Mutual Investors vs. American Independence Kansas
Performance |
| Timeline |
| Washington Mutual |
| American Independence |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Washington Mutual and American Independence Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Washington Mutual and American Independence
The main advantage of trading using opposite Washington Mutual and American Independence positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Washington Mutual position performs unexpectedly, American Independence 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 American Independence will offset losses from the drop in American Independence's long position.| Washington Mutual vs. Growth Fund Of | Washington Mutual vs. Europacific Growth Fund | Washington Mutual vs. Smallcap World Fund | Washington Mutual vs. Investment Of America |
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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