Correlation Between Doubleline Etf and Western Asset

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

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

Diversification Opportunities for Doubleline Etf and Western Asset

0.5

Correlation Coefficient

Doubleline Etf  Western Asset

Very weak diversification

The 3 months correlation between Doubleline and Western is 0.5. Overlapping area represents the amount of risk that can be diversified away by holding Doubleline Etf Trust and Western Asset Short in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Western Asset Short and Doubleline Etf 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 Doubleline Etf Trust 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 Short has no effect on the direction of Doubleline Etf i.e., Doubleline Etf and Western Asset go up and down completely randomly.

Pair Corralation between Doubleline Etf and Western Asset

Given the investment horizon of 90 days Doubleline Etf is expected to generate 1.08 times less return on investment than Western Asset. In addition to that, Doubleline Etf is 3.07 times more volatile than Western Asset Short. It trades about 0.06 of its total potential returns per unit of risk. Western Asset Short is currently generating about 0.2 per unit of volatility. If you would invest  2,180  in Western Asset Short on December 2, 2024 and sell it today you would earn a total of  244.00  from holding Western Asset Short or generate 11.19% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	100.0%
Values	Daily Returns

Doubleline Etf Trust  vs.  Western Asset Short

Doubleline Etf Trust

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Doubleline Etf Trust are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively stable fundamental drivers, Doubleline Etf is not utilizing all of its potentials. The current stock price uproar, may contribute to short-horizon losses for the private investors.

Western Asset Short

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Western Asset Short are ranked lower than 20 (%) of all global equities and portfolios over the last 90 days. In spite of rather sound basic indicators, Western Asset is not utilizing all of its potentials. The current stock price tumult, may contribute to shorter-term losses for the shareholders.

Pair Trading with Doubleline Etf and Western Asset

The main advantage of trading using opposite Doubleline Etf and Western Asset positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Doubleline Etf 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 Doubleline Etf Trust and Western Asset Short 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.

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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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.