Correlation Between Sextant Global and Sextant Growth
Can any of the company-specific risk be diversified away by investing in both Sextant Global and Sextant Growth 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 Sextant Global and Sextant Growth into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sextant Global High and Sextant Growth Fund, you can compare the effects of market volatilities on Sextant Global and Sextant Growth 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 Sextant Global with a short position of Sextant Growth. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sextant Global and Sextant Growth.
Diversification Opportunities for Sextant Global and Sextant Growth
-0.28 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Sextant and Sextant is -0.28. Overlapping area represents the amount of risk that can be diversified away by holding Sextant Global High and Sextant Growth Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sextant Growth and Sextant Global 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 Sextant Global High are associated (or correlated) with Sextant Growth. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sextant Growth has no effect on the direction of Sextant Global i.e., Sextant Global and Sextant Growth go up and down completely randomly.
Pair Corralation between Sextant Global and Sextant Growth
Assuming the 90 days horizon Sextant Global High is expected to under-perform the Sextant Growth. But the mutual fund apears to be less risky and, when comparing its historical volatility, Sextant Global High is 1.87 times less risky than Sextant Growth. The mutual fund trades about -0.02 of its potential returns per unit of risk. The Sextant Growth Fund is currently generating about 0.17 of returns per unit of risk over similar time horizon. If you would invest 5,386 in Sextant Growth Fund on September 13, 2024 and sell it today you would earn a total of 511.00 from holding Sextant Growth Fund or generate 9.49% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 98.44% |
Values | Daily Returns |
Sextant Global High vs. Sextant Growth Fund
Performance |
Timeline |
Sextant Global High |
Sextant Growth |
Sextant Global and Sextant Growth Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Sextant Global and Sextant Growth
The main advantage of trading using opposite Sextant Global and Sextant Growth positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sextant Global position performs unexpectedly, Sextant Growth 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 Sextant Growth will offset losses from the drop in Sextant Growth's long position.Sextant Global vs. Sextant Growth Fund | Sextant Global vs. Sextant International Fund | Sextant Global vs. Sextant Bond Income | Sextant Global vs. Sextant Short Term Bond |
Sextant Growth vs. Sextant International Fund | Sextant Growth vs. Sextant Bond Income | Sextant Growth vs. Teton Westwood Equity | Sextant Growth vs. Value Line Premier |
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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
Other Complementary Tools
Risk-Return Analysis View associations between returns expected from investment and the risk you assume | |
Portfolio Volatility Check portfolio volatility and analyze historical return density to properly model market risk | |
Price Transformation Use Price Transformation models to analyze the depth of different equity instruments across global markets | |
Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios | |
Share Portfolio Track or share privately all of your investments from the convenience of any device |