Correlation Between Sit Emerging and Catholic Values

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

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

Diversification Opportunities for Sit Emerging and Catholic Values

0.85

Correlation Coefficient

Sit Emerging  Catholic Values

Very poor diversification

The 3 months correlation between Sit and Catholic is 0.85. Overlapping area represents the amount of risk that can be diversified away by holding Sit Emerging Markets and Catholic Values Fixed in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Catholic Values Fixed and Sit 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 Sit Emerging Markets are associated (or correlated) with Catholic Values. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Catholic Values Fixed has no effect on the direction of Sit Emerging i.e., Sit Emerging and Catholic Values go up and down completely randomly.

Pair Corralation between Sit Emerging and Catholic Values

Assuming the 90 days horizon Sit Emerging Markets is expected to under-perform the Catholic Values. In addition to that, Sit Emerging is 2.07 times more volatile than Catholic Values Fixed. It trades about -0.36 of its total potential returns per unit of risk. Catholic Values Fixed is currently generating about -0.54 per unit of volatility. If you would invest  871.00  in Catholic Values Fixed on October 10, 2024 and sell it today you would lose (25.00) from holding Catholic Values Fixed or give up 2.87% of portfolio value over 90 days.

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

Sit Emerging Markets  vs.  Catholic Values Fixed

Sit Emerging Markets

Risk-Adjusted Performance

0 of 100

Very Weak

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

Catholic Values Fixed

Risk-Adjusted Performance

0 of 100

Very Weak

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

Pair Trading with Sit Emerging and Catholic Values

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

The idea behind Sit Emerging Markets and Catholic Values Fixed 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 Bonds Directory module to find actively traded corporate debentures issued by US companies.