Correlation Between Sterling Capital and Ancorathelen Small
Can any of the company-specific risk be diversified away by investing in both Sterling Capital and Ancorathelen Small 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 Sterling Capital and Ancorathelen Small into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sterling Capital North and Ancorathelen Small Mid Cap, you can compare the effects of market volatilities on Sterling Capital and Ancorathelen Small 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 Sterling Capital with a short position of Ancorathelen Small. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sterling Capital and Ancorathelen Small.
Diversification Opportunities for Sterling Capital and Ancorathelen Small
-0.39 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Sterling and Ancorathelen is -0.39. Overlapping area represents the amount of risk that can be diversified away by holding Sterling Capital North and Ancorathelen Small Mid Cap in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ancorathelen Small Mid and Sterling 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 Sterling Capital North are associated (or correlated) with Ancorathelen Small. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ancorathelen Small Mid has no effect on the direction of Sterling Capital i.e., Sterling Capital and Ancorathelen Small go up and down completely randomly.
Pair Corralation between Sterling Capital and Ancorathelen Small
Assuming the 90 days horizon Sterling Capital is expected to generate 9.39 times less return on investment than Ancorathelen Small. But when comparing it to its historical volatility, Sterling Capital North is 6.16 times less risky than Ancorathelen Small. It trades about 0.07 of its potential returns per unit of risk. Ancorathelen Small Mid Cap is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest 1,569 in Ancorathelen Small Mid Cap on September 2, 2024 and sell it today you would earn a total of 705.00 from holding Ancorathelen Small Mid Cap or generate 44.93% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sterling Capital North vs. Ancorathelen Small Mid Cap
Performance |
| Timeline |
| Sterling Capital North |
| Ancorathelen Small Mid |
Sterling Capital and Ancorathelen Small Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sterling Capital and Ancorathelen Small
The main advantage of trading using opposite Sterling Capital and Ancorathelen Small positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sterling Capital position performs unexpectedly, Ancorathelen Small 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 Ancorathelen Small will offset losses from the drop in Ancorathelen Small's long position.| Sterling Capital vs. Sterling Capital Equity | Sterling Capital vs. Sterling Capital Behavioral | Sterling Capital vs. Sterling Capital Behavioral | Sterling Capital vs. Sterling Capital Behavioral |
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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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
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