Correlation Between Alger Health and Simt Multi-asset
Can any of the company-specific risk be diversified away by investing in both Alger Health and Simt Multi-asset 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 Health and Simt Multi-asset into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Alger Health Sciences and Simt Multi Asset Inflation, you can compare the effects of market volatilities on Alger Health and Simt Multi-asset 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 Health with a short position of Simt Multi-asset. Check out your portfolio center. Please also check ongoing floating volatility patterns of Alger Health and Simt Multi-asset.
Diversification Opportunities for Alger Health and Simt Multi-asset
-0.14 | Correlation Coefficient |
Good diversification
The 3 months correlation between Alger and Simt is -0.14. Overlapping area represents the amount of risk that can be diversified away by holding Alger Health Sciences and Simt Multi Asset Inflation in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Simt Multi Asset and Alger Health 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 Health Sciences are associated (or correlated) with Simt Multi-asset. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Simt Multi Asset has no effect on the direction of Alger Health i.e., Alger Health and Simt Multi-asset go up and down completely randomly.
Pair Corralation between Alger Health and Simt Multi-asset
Assuming the 90 days horizon Alger Health Sciences is expected to generate 3.56 times more return on investment than Simt Multi-asset. However, Alger Health is 3.56 times more volatile than Simt Multi Asset Inflation. It trades about 0.08 of its potential returns per unit of risk. Simt Multi Asset Inflation is currently generating about 0.08 per unit of risk. If you would invest 1,333 in Alger Health Sciences on August 28, 2024 and sell it today you would earn a total of 18.00 from holding Alger Health Sciences or generate 1.35% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Alger Health Sciences vs. Simt Multi Asset Inflation
Performance |
| Timeline |
| Alger Health Sciences |
| Simt Multi Asset |
Alger Health and Simt Multi-asset Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Alger Health and Simt Multi-asset
The main advantage of trading using opposite Alger Health and Simt Multi-asset positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Alger Health position performs unexpectedly, Simt Multi-asset 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 Simt Multi-asset will offset losses from the drop in Simt Multi-asset's long position.| Alger Health vs. Harbor Vertible Securities | Alger Health vs. Franklin Vertible Securities | Alger Health vs. Absolute Convertible Arbitrage | Alger Health vs. Teton Vertible Securities |
| Simt Multi-asset vs. Simt Multi Asset Accumulation | Simt Multi-asset vs. Saat Market Growth | Simt Multi-asset vs. Simt Real Return | Simt Multi-asset vs. Simt Small Cap |
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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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