Correlation Between Global Real and Old Westbury
Can any of the company-specific risk be diversified away by investing in both Global Real 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 Global Real and Old Westbury into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Global Real Estate and Old Westbury Municipal, you can compare the effects of market volatilities on Global Real 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 Global Real with a short position of Old Westbury. Check out your portfolio center. Please also check ongoing floating volatility patterns of Global Real and Old Westbury.
Diversification Opportunities for Global Real and Old Westbury
0.46 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Global and Old is 0.46. Overlapping area represents the amount of risk that can be diversified away by holding Global Real Estate 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 Global Real 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 Global Real Estate 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 Global Real i.e., Global Real and Old Westbury go up and down completely randomly.
Pair Corralation between Global Real and Old Westbury
Assuming the 90 days horizon Global Real Estate is expected to generate 8.2 times more return on investment than Old Westbury. However, Global Real is 8.2 times more volatile than Old Westbury Municipal. It trades about 0.09 of its potential returns per unit of risk. Old Westbury Municipal is currently generating about 0.33 per unit of risk. If you would invest 872.00 in Global Real Estate on May 26, 2025 and sell it today you would earn a total of 34.00 from holding Global Real Estate or generate 3.9% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Global Real Estate vs. Old Westbury Municipal
Performance |
| Timeline |
| Global Real Estate |
| Old Westbury Municipal |
Global Real and Old Westbury Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Global Real and Old Westbury
The main advantage of trading using opposite Global Real and Old Westbury positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Global Real 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.| Global Real vs. Real Estate Securities | Global Real vs. International Emerging Markets | Global Real vs. Midcap Fund Class | Global Real vs. Global Diversified Income |
| Old Westbury vs. Europac Gold Fund | Old Westbury vs. Oppenheimer Gold Special | Old Westbury vs. James Balanced Golden | Old Westbury vs. Global Gold Fund |
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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
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