Correlation Between Short-term Investment and Dana Large

Can any of the company-specific risk be diversified away by investing in both Short-term Investment and Dana Large 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 Short-term Investment and Dana Large into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Short Term Investment Trust and Dana Large Cap, you can compare the effects of market volatilities on Short-term Investment and Dana Large 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 Short-term Investment with a short position of Dana Large. Check out your portfolio center. Please also check ongoing floating volatility patterns of Short-term Investment and Dana Large.

Diversification Opportunities for Short-term Investment and Dana Large

0.0

Correlation Coefficient

Short-term Investment  Dana Large

Pay attention - limited upside

The 3 months correlation between Short-term and Dana is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Short Term Investment Trust and Dana Large Cap in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dana Large Cap and Short-term Investment 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 Short Term Investment Trust are associated (or correlated) with Dana Large. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dana Large Cap has no effect on the direction of Short-term Investment i.e., Short-term Investment and Dana Large go up and down completely randomly.

Pair Corralation between Short-term Investment and Dana Large

If you would invest  100.00  in Short Term Investment Trust on October 8, 2024 and sell it today you would earn a total of  0.00  from holding Short Term Investment Trust or generate 0.0% return on investment over 90 days.

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

Short Term Investment Trust  vs.  Dana Large Cap

Short Term Investment

Risk-Adjusted Performance

0 of 100

Very Weak

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

Dana Large Cap

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Dana Large Cap has generated negative risk-adjusted returns adding no value to fund investors. In spite of weak performance in the last few months, the Fund's forward indicators remain fairly strong which may send shares a bit higher in February 2025. The current disturbance may also be a sign of long term up-swing for the fund investors.

Pair Trading with Short-term Investment and Dana Large

The main advantage of trading using opposite Short-term Investment and Dana Large positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Short-term Investment position performs unexpectedly, Dana Large 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 Dana Large will offset losses from the drop in Dana Large's long position.

The idea behind Short Term Investment Trust and Dana Large 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.

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 Portfolio Center module to all portfolio management and optimization tools to improve performance of your portfolios.