Correlation Between American Mutual and Simt Large
Can any of the company-specific risk be diversified away by investing in both American Mutual and Simt 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 American Mutual and Simt Large into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between American Mutual Fund and Simt Large Cap, you can compare the effects of market volatilities on American Mutual and Simt 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 American Mutual with a short position of Simt Large. Check out your portfolio center. Please also check ongoing floating volatility patterns of American Mutual and Simt Large.
Diversification Opportunities for American Mutual and Simt Large
0.91 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between American and Simt is 0.91. Overlapping area represents the amount of risk that can be diversified away by holding American Mutual Fund and Simt Large Cap in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Simt Large Cap and American Mutual 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 American Mutual Fund are associated (or correlated) with Simt Large. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Simt Large Cap has no effect on the direction of American Mutual i.e., American Mutual and Simt Large go up and down completely randomly.
Pair Corralation between American Mutual and Simt Large
Assuming the 90 days horizon American Mutual is expected to generate 1.39 times less return on investment than Simt Large. But when comparing it to its historical volatility, American Mutual Fund is 1.4 times less risky than Simt Large. It trades about 0.29 of its potential returns per unit of risk. Simt Large Cap is currently generating about 0.29 of returns per unit of risk over similar time horizon. If you would invest 2,741 in Simt Large Cap on September 4, 2024 and sell it today you would earn a total of 141.00 from holding Simt Large Cap or generate 5.14% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
American Mutual Fund vs. Simt Large Cap
Performance |
| Timeline |
| American Mutual |
| Simt Large Cap |
American Mutual and Simt Large Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with American Mutual and Simt Large
The main advantage of trading using opposite American Mutual and Simt Large positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if American Mutual position performs unexpectedly, Simt 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 Simt Large will offset losses from the drop in Simt Large's long position.| American Mutual vs. Rational Defensive Growth | American Mutual vs. Pace Smallmedium Growth | American Mutual vs. Pace Large Growth | American Mutual vs. L Abbett Growth |
| Simt Large vs. Simt Multi Asset Accumulation | Simt Large vs. Saat Market Growth | Simt Large vs. Simt Real Return | Simt Large 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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
Other Complementary Tools
| Equity Valuation Check real value of public entities based on technical and fundamental data | |
| Crypto Correlations Use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins | |
| FinTech Suite Use AI to screen and filter profitable investment opportunities | |
| Competition Analyzer Analyze and compare many basic indicators for a group of related or unrelated entities | |
| Analyst Advice Analyst recommendations and target price estimates broken down by several categories |