Correlation Between Vanguard Emerging and Old Westbury
Can any of the company-specific risk be diversified away by investing in both Vanguard Emerging 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 Vanguard Emerging and Old Westbury into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Vanguard Emerging Markets and Old Westbury California, you can compare the effects of market volatilities on Vanguard Emerging 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 Vanguard Emerging with a short position of Old Westbury. Check out your portfolio center. Please also check ongoing floating volatility patterns of Vanguard Emerging and Old Westbury.
Diversification Opportunities for Vanguard Emerging and Old Westbury
0.91 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Vanguard and Old is 0.91. Overlapping area represents the amount of risk that can be diversified away by holding Vanguard Emerging Markets and Old Westbury California in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Old Westbury California and Vanguard Emerging 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 Vanguard Emerging Markets 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 California has no effect on the direction of Vanguard Emerging i.e., Vanguard Emerging and Old Westbury go up and down completely randomly.
Pair Corralation between Vanguard Emerging and Old Westbury
Assuming the 90 days horizon Vanguard Emerging Markets is expected to generate 7.26 times more return on investment than Old Westbury. However, Vanguard Emerging is 7.26 times more volatile than Old Westbury California. It trades about 0.16 of its potential returns per unit of risk. Old Westbury California is currently generating about 0.43 per unit of risk. If you would invest 3,179 in Vanguard Emerging Markets on July 18, 2025 and sell it today you would earn a total of 258.00 from holding Vanguard Emerging Markets or generate 8.12% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Vanguard Emerging Markets vs. Old Westbury California
Performance |
| Timeline |
| Vanguard Emerging Markets |
| Old Westbury California |
Vanguard Emerging and Old Westbury Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Vanguard Emerging and Old Westbury
The main advantage of trading using opposite Vanguard Emerging and Old Westbury positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Vanguard Emerging 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.| Vanguard Emerging vs. Putnam Global Health | Vanguard Emerging vs. Lord Abbett Health | Vanguard Emerging vs. Health Care Fund | Vanguard Emerging vs. Prudential Health Sciences |
| Old Westbury vs. Alphacentric Lifesci Healthcare | Old Westbury vs. Lord Abbett Health | Old Westbury vs. Delaware Healthcare Fund | Old Westbury vs. Fidelity Advisor Health |
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 Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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