Correlation Between International Strategic and Apexcm Small/mid

Can any of the company-specific risk be diversified away by investing in both International Strategic and Apexcm Small/mid 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 International Strategic and Apexcm Small/mid into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between International Strategic Equities and Apexcm Smallmid Cap, you can compare the effects of market volatilities on International Strategic and Apexcm Small/mid 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 International Strategic with a short position of Apexcm Small/mid. Check out your portfolio center. Please also check ongoing floating volatility patterns of International Strategic and Apexcm Small/mid.

Diversification Opportunities for International Strategic and Apexcm Small/mid

-0.29

Correlation Coefficient

International Strategic  Apexcm Small/mid

Very good diversification

The 3 months correlation between International and Apexcm is -0.29. Overlapping area represents the amount of risk that can be diversified away by holding International Strategic Equiti and Apexcm Smallmid Cap in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Apexcm Smallmid Cap and International Strategic 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 International Strategic Equities are associated (or correlated) with Apexcm Small/mid. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Apexcm Smallmid Cap has no effect on the direction of International Strategic i.e., International Strategic and Apexcm Small/mid go up and down completely randomly.

Pair Corralation between International Strategic and Apexcm Small/mid

Assuming the 90 days horizon International Strategic Equities is expected to generate 0.78 times more return on investment than Apexcm Small/mid. However, International Strategic Equities is 1.28 times less risky than Apexcm Small/mid. It trades about 0.06 of its potential returns per unit of risk. Apexcm Smallmid Cap is currently generating about 0.04 per unit of risk. If you would invest  1,091  in International Strategic Equities on October 4, 2024 and sell it today you would earn a total of  179.00  from holding International Strategic Equities or generate 16.41% return on investment over 90 days.

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

International Strategic Equiti  vs.  Apexcm Smallmid Cap

International Strategic

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days International Strategic Equities has generated negative risk-adjusted returns adding no value to fund investors. In spite of latest weak performance, the Fund's basic indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the fund investors.

Apexcm Smallmid Cap

Risk-Adjusted Performance

3 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Apexcm Smallmid Cap are ranked lower than 3 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong technical and fundamental indicators, Apexcm Small/mid is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with International Strategic and Apexcm Small/mid

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

The idea behind International Strategic Equities and Apexcm Smallmid Cap 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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.