Correlation Between Wpg Partners and Rbb Fund

Can any of the company-specific risk be diversified away by investing in both Wpg Partners and Rbb Fund 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 Wpg Partners and Rbb Fund into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Wpg Partners Smallmicro and Rbb Fund , you can compare the effects of market volatilities on Wpg Partners and Rbb Fund 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 Wpg Partners with a short position of Rbb Fund. Check out your portfolio center. Please also check ongoing floating volatility patterns of Wpg Partners and Rbb Fund.

Diversification Opportunities for Wpg Partners and Rbb Fund

0.99

Correlation Coefficient

Wpg Partners  Rbb Fund

No risk reduction

The 3 months correlation between Wpg and Rbb is 0.99. Overlapping area represents the amount of risk that can be diversified away by holding Wpg Partners Smallmicro and Rbb Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Rbb Fund and Wpg Partners 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 Wpg Partners Smallmicro are associated (or correlated) with Rbb Fund. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Rbb Fund has no effect on the direction of Wpg Partners i.e., Wpg Partners and Rbb Fund go up and down completely randomly.

Pair Corralation between Wpg Partners and Rbb Fund

Assuming the 90 days horizon Wpg Partners Smallmicro is expected to generate 0.79 times more return on investment than Rbb Fund. However, Wpg Partners Smallmicro is 1.26 times less risky than Rbb Fund. It trades about -0.11 of its potential returns per unit of risk. Rbb Fund is currently generating about -0.16 per unit of risk. If you would invest  1,932  in Wpg Partners Smallmicro on December 1, 2024 and sell it today you would lose (73.00) from holding Wpg Partners Smallmicro or give up 3.78% of portfolio value over 90 days.

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

Wpg Partners Smallmicro  vs.  Rbb Fund

Wpg Partners Smallmicro

Risk-Adjusted Performance

Very Weak

Over the last 90 days Wpg Partners Smallmicro has generated negative risk-adjusted returns adding no value to fund investors. In spite of weak performance in the last few months, the Fund's basic indicators remain fairly strong which may send shares a bit higher in April 2025. The current disturbance may also be a sign of long term up-swing for the fund investors.

Rbb Fund

Risk-Adjusted Performance

Very Weak

Over the last 90 days Rbb Fund has generated negative risk-adjusted returns adding no value to fund investors. In spite of weak performance in the last few months, the Fund's basic indicators remain fairly strong which may send shares a bit higher in April 2025. The current disturbance may also be a sign of long term up-swing for the fund investors.

Pair Trading with Wpg Partners and Rbb Fund

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

The idea behind Wpg Partners Smallmicro and Rbb Fund 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 Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.