Correlation Between Western Asset and Jhancock Diversified
Can any of the company-specific risk be diversified away by investing in both Western Asset and Jhancock Diversified 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 Jhancock Diversified into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Western Asset Diversified and Jhancock Diversified Macro, you can compare the effects of market volatilities on Western Asset and Jhancock Diversified 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 Jhancock Diversified. Check out your portfolio center. Please also check ongoing floating volatility patterns of Western Asset and Jhancock Diversified.
Diversification Opportunities for Western Asset and Jhancock Diversified
-0.52 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Western and Jhancock is -0.52. Overlapping area represents the amount of risk that can be diversified away by holding Western Asset Diversified and Jhancock Diversified Macro in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jhancock Diversified 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 Diversified are associated (or correlated) with Jhancock Diversified. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jhancock Diversified has no effect on the direction of Western Asset i.e., Western Asset and Jhancock Diversified go up and down completely randomly.
Pair Corralation between Western Asset and Jhancock Diversified
Assuming the 90 days horizon Western Asset Diversified is expected to generate 0.62 times more return on investment than Jhancock Diversified. However, Western Asset Diversified is 1.61 times less risky than Jhancock Diversified. It trades about 0.0 of its potential returns per unit of risk. Jhancock Diversified Macro is currently generating about -0.01 per unit of risk. If you would invest 1,528 in Western Asset Diversified on November 27, 2024 and sell it today you would lose (6.00) from holding Western Asset Diversified or give up 0.39% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Western Asset Diversified vs. Jhancock Diversified Macro
Performance |
| Timeline |
| Western Asset Diversified |
| Jhancock Diversified |
Western Asset and Jhancock Diversified Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Western Asset and Jhancock Diversified
The main advantage of trading using opposite Western Asset and Jhancock Diversified positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Western Asset position performs unexpectedly, Jhancock Diversified 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 Jhancock Diversified will offset losses from the drop in Jhancock Diversified's long position.| Western Asset vs. Nexpoint Real Estate | Western Asset vs. Baron Real Estate | Western Asset vs. Nomura Real Estate | Western Asset vs. Forum Real Estate |
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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
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