Correlation Between Sa International and Old Westbury
Can any of the company-specific risk be diversified away by investing in both Sa International and Old Westbury 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 Sa International and Old Westbury into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sa International Value and Old Westbury Municipal, you can compare the effects of market volatilities on Sa International and Old Westbury 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 Sa International with a short position of Old Westbury. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sa International and Old Westbury.
Diversification Opportunities for Sa International and Old Westbury
0.55 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between SAHMX and Old is 0.55. Overlapping area represents the amount of risk that can be diversified away by holding Sa International Value and Old Westbury Municipal in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Old Westbury Municipal and Sa International 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 Sa International Value are associated (or correlated) with Old Westbury. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Old Westbury Municipal has no effect on the direction of Sa International i.e., Sa International and Old Westbury go up and down completely randomly.
Pair Corralation between Sa International and Old Westbury
Assuming the 90 days horizon Sa International Value is expected to generate 4.21 times more return on investment than Old Westbury. However, Sa International is 4.21 times more volatile than Old Westbury Municipal. It trades about 0.17 of its potential returns per unit of risk. Old Westbury Municipal is currently generating about 0.02 per unit of risk. If you would invest 1,311 in Sa International Value on December 4, 2024 and sell it today you would earn a total of 99.00 from holding Sa International Value or generate 7.55% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Weak |
Accuracy | 98.33% |
Values | Daily Returns |
Sa International Value vs. Old Westbury Municipal
Performance |
Timeline |
Sa International Value |
Old Westbury Municipal |
Sa International and Old Westbury Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Sa International and Old Westbury
The main advantage of trading using opposite Sa International and Old Westbury positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sa International position performs unexpectedly, Old Westbury 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 Old Westbury will offset losses from the drop in Old Westbury's long position.Sa International vs. Federated Government Income | Sa International vs. Ms Global Fixed | Sa International vs. Qs International Equity | Sa International vs. Rbc Funds Trust |
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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 Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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