Correlation Between Small Cap and Nt Non-us

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

By analyzing existing cross correlation between Small Cap Growth and Nt Non US Intrinsic, you can compare the effects of market volatilities on Small Cap and Nt Non-us 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 Nt Non-us. Check out your portfolio center. Please also check ongoing floating volatility patterns of Small Cap and Nt Non-us.

Diversification Opportunities for Small Cap and Nt Non-us

-0.6

Correlation Coefficient

Small Cap  Nt Non-us

Excellent diversification

The 3 months correlation between Small and ANTUX is -0.6. Overlapping area represents the amount of risk that can be diversified away by holding Small Cap Growth and Nt Non US Intrinsic in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nt Non Intrinsic 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 Growth are associated (or correlated) with Nt Non-us. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nt Non Intrinsic has no effect on the direction of Small Cap i.e., Small Cap and Nt Non-us go up and down completely randomly.

Pair Corralation between Small Cap and Nt Non-us

Assuming the 90 days horizon Small Cap Growth is expected to under-perform the Nt Non-us. In addition to that, Small Cap is 1.3 times more volatile than Nt Non US Intrinsic. It trades about -0.06 of its total potential returns per unit of risk. Nt Non US Intrinsic is currently generating about 0.21 per unit of volatility. If you would invest  799.00  in Nt Non US Intrinsic on December 28, 2024 and sell it today you would earn a total of  108.00  from holding Nt Non US Intrinsic or generate 13.52% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	98.36%
Values	Daily Returns

Small Cap Growth  vs.  Nt Non US Intrinsic

Small Cap Growth

Risk-Adjusted Performance

Very Weak

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

Nt Non Intrinsic

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Nt Non US Intrinsic are ranked lower than 16 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak basic indicators, Nt Non-us showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Small Cap and Nt Non-us

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

The idea behind Small Cap Growth and Nt Non US Intrinsic 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.

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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 Anywhere module to track or share privately all of your investments from the convenience of any device.