Correlation Between Sterling Capital and Alps/kotak India
Can any of the company-specific risk be diversified away by investing in both Sterling Capital and Alps/kotak India 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 Alps/kotak India into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sterling Capital Short and Alpskotak India Growth, you can compare the effects of market volatilities on Sterling Capital and Alps/kotak India 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 Alps/kotak India. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sterling Capital and Alps/kotak India.
Diversification Opportunities for Sterling Capital and Alps/kotak India
0.64 | Correlation Coefficient |
Poor diversification
The 3 months correlation between STERLING and Alps/kotak is 0.64. Overlapping area represents the amount of risk that can be diversified away by holding Sterling Capital Short and Alpskotak India Growth in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Alpskotak India Growth 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 Short are associated (or correlated) with Alps/kotak India. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Alpskotak India Growth has no effect on the direction of Sterling Capital i.e., Sterling Capital and Alps/kotak India go up and down completely randomly.
Pair Corralation between Sterling Capital and Alps/kotak India
Assuming the 90 days horizon Sterling Capital Short is expected to generate 0.11 times more return on investment than Alps/kotak India. However, Sterling Capital Short is 8.99 times less risky than Alps/kotak India. It trades about 0.06 of its potential returns per unit of risk. Alpskotak India Growth is currently generating about -0.01 per unit of risk. If you would invest 833.00 in Sterling Capital Short on September 2, 2024 and sell it today you would earn a total of 3.00 from holding Sterling Capital Short or generate 0.36% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sterling Capital Short vs. Alpskotak India Growth
Performance |
| Timeline |
| Sterling Capital Short |
| Alpskotak India Growth |
Sterling Capital and Alps/kotak India Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sterling Capital and Alps/kotak India
The main advantage of trading using opposite Sterling Capital and Alps/kotak India positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sterling Capital position performs unexpectedly, Alps/kotak India 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 Alps/kotak India will offset losses from the drop in Alps/kotak India's long position.| Sterling Capital vs. Sterling Capital Equity | Sterling Capital vs. Sterling Capital Behavioral | Sterling Capital vs. Sterling Capital South | Sterling Capital vs. Sterling Capital South |
| Alps/kotak India vs. Royce Global Financial | Alps/kotak India vs. Angel Oak Financial | Alps/kotak India vs. Vanguard Financials Index | Alps/kotak India vs. John Hancock Financial |
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 Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
Other Complementary Tools
| Sectors List of equity sectors categorizing publicly traded companies based on their primary business activities | |
| Idea Breakdown Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes | |
| Piotroski F Score Get Piotroski F Score based on the binary analysis strategy of nine different fundamentals | |
| Earnings Calls Check upcoming earnings announcements updated hourly across public exchanges | |
| Balance Of Power Check stock momentum by analyzing Balance Of Power indicator and other technical ratios |