Correlation Between Aqr Small and Sterling Capital
Can any of the company-specific risk be diversified away by investing in both Aqr Small 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 Aqr Small and Sterling Capital into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Aqr Small Cap and Sterling Capital Securitized, you can compare the effects of market volatilities on Aqr Small 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 Aqr Small with a short position of Sterling Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aqr Small and Sterling Capital.
Diversification Opportunities for Aqr Small and Sterling Capital
0.34 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Aqr and Sterling is 0.34. Overlapping area represents the amount of risk that can be diversified away by holding Aqr Small Cap and Sterling Capital Securitized in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sterling Capital Sec and Aqr Small 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 Aqr Small Cap 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 Sec has no effect on the direction of Aqr Small i.e., Aqr Small and Sterling Capital go up and down completely randomly.
Pair Corralation between Aqr Small and Sterling Capital
Assuming the 90 days horizon Aqr Small Cap is expected to under-perform the Sterling Capital. In addition to that, Aqr Small is 5.24 times more volatile than Sterling Capital Securitized. It trades about -0.02 of its total potential returns per unit of risk. Sterling Capital Securitized is currently generating about 0.08 per unit of volatility. If you would invest 859.00 in Sterling Capital Securitized on December 5, 2024 and sell it today you would earn a total of 47.00 from holding Sterling Capital Securitized or generate 5.47% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Very Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Aqr Small Cap vs. Sterling Capital Securitized
Performance |
Timeline |
Aqr Small Cap |
Sterling Capital Sec |
Aqr Small and Sterling Capital Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Aqr Small and Sterling Capital
The main advantage of trading using opposite Aqr Small and Sterling Capital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aqr Small 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.Aqr Small vs. Bbh Partner Fund | Aqr Small vs. Dreyfusstandish Global Fixed | Aqr Small vs. Scharf Global Opportunity | Aqr Small vs. Tax Managed International Equity |
Sterling Capital vs. Calvert Large Cap | Sterling Capital vs. Transamerica Large Cap | Sterling Capital vs. Touchstone Large Cap | Sterling Capital vs. Blackrock Large Cap |
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 Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
Other Complementary Tools
FinTech Suite Use AI to screen and filter profitable investment opportunities | |
Bollinger Bands Use Bollinger Bands indicator to analyze target price for a given investing horizon | |
Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities | |
ETF Categories List of ETF categories grouped based on various criteria, such as the investment strategy or type of investments | |
Investing Opportunities Build portfolios using our predefined set of ideas and optimize them against your investing preferences |