Correlation Between Avantis Us and Old Westbury
Can any of the company-specific risk be diversified away by investing in both Avantis Us 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 Avantis Us and Old Westbury into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Avantis Large Cap and Old Westbury Small, you can compare the effects of market volatilities on Avantis Us 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 Avantis Us with a short position of Old Westbury. Check out your portfolio center. Please also check ongoing floating volatility patterns of Avantis Us and Old Westbury.
Diversification Opportunities for Avantis Us and Old Westbury
0.42 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Avantis and Old is 0.42. Overlapping area represents the amount of risk that can be diversified away by holding Avantis Large Cap and Old Westbury Small in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Old Westbury Small and Avantis Us 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 Avantis Large Cap 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 Small has no effect on the direction of Avantis Us i.e., Avantis Us and Old Westbury go up and down completely randomly.
Pair Corralation between Avantis Us and Old Westbury
Assuming the 90 days horizon Avantis Large Cap is expected to generate 1.18 times more return on investment than Old Westbury. However, Avantis Us is 1.18 times more volatile than Old Westbury Small. It trades about 0.04 of its potential returns per unit of risk. Old Westbury Small is currently generating about 0.04 per unit of risk. If you would invest 1,540 in Avantis Large Cap on September 11, 2025 and sell it today you would earn a total of 31.00 from holding Avantis Large Cap or generate 2.01% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 98.44% |
| Values | Daily Returns |
Avantis Large Cap vs. Old Westbury Small
Performance |
| Timeline |
| Avantis Large Cap |
| Old Westbury Small |
Avantis Us and Old Westbury Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Avantis Us and Old Westbury
The main advantage of trading using opposite Avantis Us and Old Westbury positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Avantis Us 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.| Avantis Us vs. Franklin Adjustable Government | Avantis Us vs. Short Term Government Fund | Avantis Us vs. Us Government Securities | Avantis Us vs. Federated Government Income |
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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 Global Correlations module to find global opportunities by holding instruments from different markets.
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