Correlation Between Alger Capital and Siit High
Can any of the company-specific risk be diversified away by investing in both Alger Capital and Siit High 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 Alger Capital and Siit High into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Alger Capital Appreciation and Siit High Yield, you can compare the effects of market volatilities on Alger Capital and Siit High 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 Alger Capital with a short position of Siit High. Check out your portfolio center. Please also check ongoing floating volatility patterns of Alger Capital and Siit High.
Diversification Opportunities for Alger Capital and Siit High
0.83 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Alger and Siit is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding Alger Capital Appreciation and Siit High Yield in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Siit High Yield and Alger Capital 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 Alger Capital Appreciation are associated (or correlated) with Siit High. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Siit High Yield has no effect on the direction of Alger Capital i.e., Alger Capital and Siit High go up and down completely randomly.
Pair Corralation between Alger Capital and Siit High
Assuming the 90 days horizon Alger Capital Appreciation is expected to generate 6.05 times more return on investment than Siit High. However, Alger Capital is 6.05 times more volatile than Siit High Yield. It trades about 0.11 of its potential returns per unit of risk. Siit High Yield is currently generating about 0.2 per unit of risk. If you would invest 3,171 in Alger Capital Appreciation on September 3, 2024 and sell it today you would earn a total of 606.00 from holding Alger Capital Appreciation or generate 19.11% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Alger Capital Appreciation vs. Siit High Yield
Performance |
| Timeline |
| Alger Capital Apprec |
| Siit High Yield |
Alger Capital and Siit High Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Alger Capital and Siit High
The main advantage of trading using opposite Alger Capital and Siit High positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Alger Capital position performs unexpectedly, Siit High 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 Siit High will offset losses from the drop in Siit High's long position.| Alger Capital vs. T Rowe Price | Alger Capital vs. Qs Moderate Growth | Alger Capital vs. T Rowe Price | Alger Capital vs. T Rowe Price |
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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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