Correlation Between Sentinel Small and Ft 7934

Can any of the company-specific risk be diversified away by investing in both Sentinel Small and Ft 7934 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 Sentinel Small and Ft 7934 into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Sentinel Small Pany and Ft 7934 Corporate, you can compare the effects of market volatilities on Sentinel Small and Ft 7934 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 Sentinel Small with a short position of Ft 7934. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sentinel Small and Ft 7934.

Diversification Opportunities for Sentinel Small and Ft 7934

-0.31

Correlation Coefficient

Sentinel Small  Ft 7934

Very good diversification

The 3 months correlation between Sentinel and FZNQEX is -0.31. Overlapping area represents the amount of risk that can be diversified away by holding Sentinel Small Pany and Ft 7934 Corporate in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ft 7934 Corporate and Sentinel 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 Sentinel Small Pany are associated (or correlated) with Ft 7934. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ft 7934 Corporate has no effect on the direction of Sentinel Small i.e., Sentinel Small and Ft 7934 go up and down completely randomly.

Pair Corralation between Sentinel Small and Ft 7934

Assuming the 90 days horizon Sentinel Small Pany is expected to under-perform the Ft 7934. In addition to that, Sentinel Small is 8.76 times more volatile than Ft 7934 Corporate. It trades about -0.04 of its total potential returns per unit of risk. Ft 7934 Corporate is currently generating about -0.18 per unit of volatility. If you would invest  58,699  in Ft 7934 Corporate on September 24, 2024 and sell it today you would lose (931.00) from holding Ft 7934 Corporate or give up 1.59% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Sentinel Small Pany  vs.  Ft 7934 Corporate

Sentinel Small Pany

Risk-Adjusted Performance

0 of 100

Very Weak

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

Ft 7934 Corporate

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Ft 7934 Corporate has generated negative risk-adjusted returns adding no value to fund investors. In spite of fairly strong basic indicators, Ft 7934 is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Sentinel Small and Ft 7934

The main advantage of trading using opposite Sentinel Small and Ft 7934 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sentinel Small position performs unexpectedly, Ft 7934 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 Ft 7934 will offset losses from the drop in Ft 7934's long position.

The idea behind Sentinel Small Pany and Ft 7934 Corporate 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 CEOs Directory module to screen CEOs from public companies around the world.