Correlation Between Small Cap and Credit Suisse

Can any of the company-specific risk be diversified away by investing in both Small Cap and Credit Suisse 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 Small Cap and Credit Suisse into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Small Cap Dividend and Credit Suisse Multialternative, you can compare the effects of market volatilities on Small Cap and Credit Suisse 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 Small Cap with a short position of Credit Suisse. Check out your portfolio center. Please also check ongoing floating volatility patterns of Small Cap and Credit Suisse.

Diversification Opportunities for Small Cap and Credit Suisse

0.0

Correlation Coefficient

Small Cap  Credit Suisse

Pay attention - limited upside

The 3 months correlation between Small and Credit is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Small Cap Dividend and Credit Suisse Multialternative in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Credit Suisse Multia and Small Cap 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 Small Cap Dividend are associated (or correlated) with Credit Suisse. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Credit Suisse Multia has no effect on the direction of Small Cap i.e., Small Cap and Credit Suisse go up and down completely randomly.

Pair Corralation between Small Cap and Credit Suisse

If you would invest  797.00  in Credit Suisse Multialternative on October 24, 2024 and sell it today you would earn a total of  23.00  from holding Credit Suisse Multialternative or generate 2.89% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	1.67%
Values	Daily Returns

Small Cap Dividend  vs.  Credit Suisse Multialternative

Small Cap Dividend

Risk-Adjusted Performance

0 of 100

Modest

Over the last 90 days Small Cap Dividend has generated negative risk-adjusted returns adding no value to fund investors. In spite of fairly strong forward-looking indicators, Small Cap is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Credit Suisse Multia

Risk-Adjusted Performance

11 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Credit Suisse Multialternative are ranked lower than 11 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong forward indicators, Credit Suisse is not utilizing all of its potentials. The latest stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Small Cap and Credit Suisse

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

The idea behind Small Cap Dividend and Credit Suisse Multialternative 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.

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 .