Correlation Between Bny Mellon and Western Asset

Can any of the company-specific risk be diversified away by investing in both Bny Mellon and Western Asset 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 Bny Mellon and Western Asset into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Bny Mellon Alcentra and Western Asset Managed, you can compare the effects of market volatilities on Bny Mellon and Western Asset 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 Bny Mellon with a short position of Western Asset. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bny Mellon and Western Asset.

Diversification Opportunities for Bny Mellon and Western Asset

0.0

Correlation Coefficient

Bny Mellon  Western Asset

Pay attention - limited upside

The 3 months correlation between Bny and Western is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Bny Mellon Alcentra and Western Asset Managed in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Western Asset Managed and Bny Mellon 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 Bny Mellon Alcentra are associated (or correlated) with Western Asset. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Western Asset Managed has no effect on the direction of Bny Mellon i.e., Bny Mellon and Western Asset go up and down completely randomly.

Pair Corralation between Bny Mellon and Western Asset

If you would invest  1,003  in Western Asset Managed on December 19, 2024 and sell it today you would earn a total of  14.00  from holding Western Asset Managed or generate 1.4% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

Bny Mellon Alcentra  vs.  Western Asset Managed

Bny Mellon Alcentra

Risk-Adjusted Performance

Very Weak

Over the last 90 days Bny Mellon Alcentra has generated negative risk-adjusted returns adding no value to fund investors. Despite nearly stable fundamental indicators, Bny Mellon is not utilizing all of its potentials. The recent stock price disturbance, may contribute to mid-run losses for the stockholders.

Western Asset Managed

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Western Asset Managed are ranked lower than 3 (%) of all funds and portfolios of funds over the last 90 days. In spite of comparatively stable primary indicators, Western Asset is not utilizing all of its potentials. The current stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with Bny Mellon and Western Asset

The main advantage of trading using opposite Bny Mellon and Western Asset positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bny Mellon position performs unexpectedly, Western Asset 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 Western Asset will offset losses from the drop in Western Asset's long position.

The idea behind Bny Mellon Alcentra and Western Asset Managed pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.