Correlation Between Western Assets and Tax Exempt
Can any of the company-specific risk be diversified away by investing in both Western Assets and Tax Exempt 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 Assets and Tax Exempt into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Western Assets Emerging and The Tax Exempt Fund, you can compare the effects of market volatilities on Western Assets and Tax Exempt 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 Assets with a short position of Tax Exempt. Check out your portfolio center. Please also check ongoing floating volatility patterns of Western Assets and Tax Exempt.
Diversification Opportunities for Western Assets and Tax Exempt
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Western and Tax is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Western Assets Emerging and The Tax Exempt Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tax Exempt and Western Assets 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 Assets Emerging are associated (or correlated) with Tax Exempt. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tax Exempt has no effect on the direction of Western Assets i.e., Western Assets and Tax Exempt go up and down completely randomly.
Pair Corralation between Western Assets and Tax Exempt
If you would invest 880.00 in Western Assets Emerging on September 12, 2024 and sell it today you would earn a total of 210.00 from holding Western Assets Emerging or generate 23.86% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 0.0% |
| Values | Daily Returns |
Western Assets Emerging vs. The Tax Exempt Fund
Performance |
| Timeline |
| Western Assets Emerging |
| Tax Exempt |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Western Assets and Tax Exempt Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Western Assets and Tax Exempt
The main advantage of trading using opposite Western Assets and Tax Exempt positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Western Assets position performs unexpectedly, Tax Exempt 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 Tax Exempt will offset losses from the drop in Tax Exempt's long position.| Western Assets vs. Cb Large Cap | Western Assets vs. American Mutual Fund | Western Assets vs. Americafirst Large Cap | Western Assets vs. Dodge Cox Stock |
| Tax Exempt vs. Franklin Gold Precious | Tax Exempt vs. Invesco Gold Special | Tax Exempt vs. Precious Metals And | Tax Exempt vs. James Balanced Golden |
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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
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