Correlation Between Robinson Tax and Western Asset
Can any of the company-specific risk be diversified away by investing in both Robinson Tax and Western Asset 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 Robinson Tax and Western Asset into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Robinson Tax Advantaged and Western Asset Managed, you can compare the effects of market volatilities on Robinson Tax and Western Asset 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 Robinson Tax with a short position of Western Asset. Check out your portfolio center. Please also check ongoing floating volatility patterns of Robinson Tax and Western Asset.
Diversification Opportunities for Robinson Tax and Western Asset
0.71 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Robinson and Western is 0.71. Overlapping area represents the amount of risk that can be diversified away by holding Robinson Tax Advantaged and Western Asset Managed in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Western Asset Managed and Robinson Tax 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 Robinson Tax Advantaged are associated (or correlated) with Western Asset. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Western Asset Managed has no effect on the direction of Robinson Tax i.e., Robinson Tax and Western Asset go up and down completely randomly.
Pair Corralation between Robinson Tax and Western Asset
Assuming the 90 days horizon Robinson Tax Advantaged is expected to under-perform the Western Asset. In addition to that, Robinson Tax is 1.47 times more volatile than Western Asset Managed. It trades about -0.17 of its total potential returns per unit of risk. Western Asset Managed is currently generating about -0.22 per unit of volatility. If you would invest 1,502 in Western Asset Managed on January 25, 2024 and sell it today you would lose (14.00) from holding Western Asset Managed or give up 0.93% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Robinson Tax Advantaged vs. Western Asset Managed
Performance |
| Timeline |
| Robinson Tax Advantaged |
| Western Asset Managed |
Robinson Tax and Western Asset Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Robinson Tax and Western Asset
The main advantage of trading using opposite Robinson Tax and Western Asset positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Robinson Tax position performs unexpectedly, Western Asset 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 Western Asset will offset losses from the drop in Western Asset's long position.| Robinson Tax vs. Vanguard Long Term Tax Exempt | Robinson Tax vs. Vanguard High Yield Tax Exempt | Robinson Tax vs. Strategic Advisers Municipal |
| Western Asset vs. Vanguard Long Term Tax Exempt | Western Asset vs. Vanguard High Yield Tax Exempt | Western Asset vs. Strategic Advisers Municipal |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
Other Complementary Tools
| CEOs Directory Screen CEOs from public companies around the world | |
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing | |
| Global Markets Map Get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes | |
| Portfolio Comparator Compare the composition, asset allocations and performance of any two portfolios in your account | |
| Portfolio Manager State of the art Portfolio Manager to monitor and improve performance of your invested capital | |
| Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios | |
| Efficient Frontier Plot and analyze your portfolio and positions against risk-return landscape of the market. | |
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine | |
| Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum | |
| Portfolio Suggestion Get suggestions outside of your existing asset allocation including your own model portfolios | |
| Bond Analysis Evaluate and analyze corporate bonds as a potential investment for your portfolios. |