Correlation Between Origin Emerging and Siit Global

Can any of the company-specific risk be diversified away by investing in both Origin Emerging and Siit Global 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 Origin Emerging and Siit Global into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Origin Emerging Markets and Siit Global Managed, you can compare the effects of market volatilities on Origin Emerging and Siit Global 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 Origin Emerging with a short position of Siit Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of Origin Emerging and Siit Global.

Diversification Opportunities for Origin Emerging and Siit Global

0.28

Correlation Coefficient

Origin Emerging  Siit Global

Modest diversification

The 3 months correlation between Origin and Siit is 0.28. Overlapping area represents the amount of risk that can be diversified away by holding Origin Emerging Markets and Siit Global Managed in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Siit Global Managed and Origin 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 Origin Emerging Markets are associated (or correlated) with Siit Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Siit Global Managed has no effect on the direction of Origin Emerging i.e., Origin Emerging and Siit Global go up and down completely randomly.

Pair Corralation between Origin Emerging and Siit Global

Assuming the 90 days horizon Origin Emerging Markets is expected to under-perform the Siit Global. But the mutual fund apears to be less risky and, when comparing its historical volatility, Origin Emerging Markets is 11.96 times less risky than Siit Global. The mutual fund trades about -0.15 of its potential returns per unit of risk. The Siit Global Managed is currently generating about 0.17 of returns per unit of risk over similar time horizon. If you would invest  1,107  in Siit Global Managed on December 22, 2024 and sell it today you would earn a total of  63.00  from holding Siit Global Managed or generate 5.69% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	23.33%
Values	Daily Returns

Origin Emerging Markets  vs.  Siit Global Managed

Origin Emerging Markets

Risk-Adjusted Performance

Very Weak

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

Siit Global Managed

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Siit Global Managed are ranked lower than 13 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong basic indicators, Siit Global is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Origin Emerging and Siit Global

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

The idea behind Origin Emerging Markets and Siit Global Managed 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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.