Correlation Between Simt Small and Saat Conservative
Can any of the company-specific risk be diversified away by investing in both Simt Small and Saat Conservative 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 Simt Small and Saat Conservative into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Simt Small Cap and Saat Servative Strategy, you can compare the effects of market volatilities on Simt Small and Saat Conservative 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 Simt Small with a short position of Saat Conservative. Check out your portfolio center. Please also check ongoing floating volatility patterns of Simt Small and Saat Conservative.
Diversification Opportunities for Simt Small and Saat Conservative
-0.54 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Simt and Saat is -0.54. Overlapping area represents the amount of risk that can be diversified away by holding Simt Small Cap and Saat Servative Strategy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Saat Servative Strategy and Simt 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 Simt Small Cap are associated (or correlated) with Saat Conservative. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Saat Servative Strategy has no effect on the direction of Simt Small i.e., Simt Small and Saat Conservative go up and down completely randomly.
Pair Corralation between Simt Small and Saat Conservative
Assuming the 90 days horizon Simt Small Cap is expected to under-perform the Saat Conservative. In addition to that, Simt Small is 7.76 times more volatile than Saat Servative Strategy. It trades about -0.1 of its total potential returns per unit of risk. Saat Servative Strategy is currently generating about 0.2 per unit of volatility. If you would invest 1,047 in Saat Servative Strategy on December 27, 2024 and sell it today you would earn a total of 24.00 from holding Saat Servative Strategy or generate 2.29% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Very Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Simt Small Cap vs. Saat Servative Strategy
Performance |
Timeline |
Simt Small Cap |
Saat Servative Strategy |
Simt Small and Saat Conservative Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Simt Small and Saat Conservative
The main advantage of trading using opposite Simt Small and Saat Conservative positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Simt Small position performs unexpectedly, Saat Conservative 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 Saat Conservative will offset losses from the drop in Saat Conservative's long position.Simt Small vs. Putnam Global Financials | Simt Small vs. Prudential Financial Services | Simt Small vs. Vanguard Financials Index | Simt Small vs. Financials Ultrasector Profund |
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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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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