Correlation Between Western Asset and Vivaldi Merger
Can any of the company-specific risk be diversified away by investing in both Western Asset and Vivaldi Merger 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 Asset and Vivaldi Merger into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Western Asset Municipal and Vivaldi Merger Arbitrage, you can compare the effects of market volatilities on Western Asset and Vivaldi Merger 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 Asset with a short position of Vivaldi Merger. Check out your portfolio center. Please also check ongoing floating volatility patterns of Western Asset and Vivaldi Merger.
Diversification Opportunities for Western Asset and Vivaldi Merger
-0.74 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Western and Vivaldi is -0.74. Overlapping area represents the amount of risk that can be diversified away by holding Western Asset Municipal and Vivaldi Merger Arbitrage in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Vivaldi Merger Arbitrage and Western Asset 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 Asset Municipal are associated (or correlated) with Vivaldi Merger. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Vivaldi Merger Arbitrage has no effect on the direction of Western Asset i.e., Western Asset and Vivaldi Merger go up and down completely randomly.
Pair Corralation between Western Asset and Vivaldi Merger
Assuming the 90 days horizon Western Asset is expected to generate 3.4 times less return on investment than Vivaldi Merger. In addition to that, Western Asset is 3.8 times more volatile than Vivaldi Merger Arbitrage. It trades about 0.02 of its total potential returns per unit of risk. Vivaldi Merger Arbitrage is currently generating about 0.2 per unit of volatility. If you would invest 1,016 in Vivaldi Merger Arbitrage on August 24, 2024 and sell it today you would earn a total of 76.00 from holding Vivaldi Merger Arbitrage or generate 7.48% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Western Asset Municipal vs. Vivaldi Merger Arbitrage
Performance |
| Timeline |
| Western Asset Municipal |
| Vivaldi Merger Arbitrage |
Western Asset and Vivaldi Merger Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Western Asset and Vivaldi Merger
The main advantage of trading using opposite Western Asset and Vivaldi Merger positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Western Asset position performs unexpectedly, Vivaldi Merger 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 Vivaldi Merger will offset losses from the drop in Vivaldi Merger's long position.| Western Asset vs. Vanguard Total Stock | Western Asset vs. Vanguard 500 Index | Western Asset vs. Vanguard Total Stock | Western Asset vs. Vanguard Total Stock |
| Vivaldi Merger vs. Red Oak Technology | Vivaldi Merger vs. T Rowe Price | Vivaldi Merger vs. Qs Large Cap | Vivaldi Merger vs. Western Asset Municipal |
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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
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