Correlation Between Guinness Atkinson and Sterling Capital

Can any of the company-specific risk be diversified away by investing in both Guinness Atkinson and Sterling Capital 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 Guinness Atkinson and Sterling Capital into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Guinness Atkinson Asset and Sterling Capital Focus, you can compare the effects of market volatilities on Guinness Atkinson and Sterling Capital 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 Guinness Atkinson with a short position of Sterling Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of Guinness Atkinson and Sterling Capital.

Diversification Opportunities for Guinness Atkinson and Sterling Capital

0.0

Correlation Coefficient

Guinness Atkinson  Sterling Capital

Pay attention - limited upside

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

Pair Corralation between Guinness Atkinson and Sterling Capital

If you would invest (100.00) in Guinness Atkinson Asset on December 22, 2024 and sell it today you would earn a total of  100.00  from holding Guinness Atkinson Asset or generate -100.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

Guinness Atkinson Asset  vs.  Sterling Capital Focus

Guinness Atkinson Asset

Risk-Adjusted Performance

Very Weak

Over the last 90 days Guinness Atkinson Asset has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound basic indicators, Guinness Atkinson is not utilizing all of its potentials. The recent stock price tumult, may contribute to shorter-term losses for the shareholders.

Sterling Capital Focus

Risk-Adjusted Performance

Very Weak

Over the last 90 days Sterling Capital Focus has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable fundamental indicators, Sterling Capital is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with Guinness Atkinson and Sterling Capital

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

The idea behind Guinness Atkinson Asset and Sterling Capital Focus 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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.