Correlation Between Sterling Capital and Osterweis Emerging
Can any of the company-specific risk be diversified away by investing in both Sterling Capital and Osterweis Emerging 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 Osterweis Emerging 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 Osterweis Emerging Opportunity, you can compare the effects of market volatilities on Sterling Capital and Osterweis Emerging 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 Osterweis Emerging. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sterling Capital and Osterweis Emerging.
Diversification Opportunities for Sterling Capital and Osterweis Emerging
0.23 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Sterling and Osterweis is 0.23. Overlapping area represents the amount of risk that can be diversified away by holding Sterling Capital Short and Osterweis Emerging Opportunity in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Osterweis Emerging 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 Osterweis Emerging. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Osterweis Emerging has no effect on the direction of Sterling Capital i.e., Sterling Capital and Osterweis Emerging go up and down completely randomly.
Pair Corralation between Sterling Capital and Osterweis Emerging
Assuming the 90 days horizon Sterling Capital is expected to generate 11.26 times less return on investment than Osterweis Emerging. But when comparing it to its historical volatility, Sterling Capital Short is 8.52 times less risky than Osterweis Emerging. It trades about 0.08 of its potential returns per unit of risk. Osterweis Emerging Opportunity is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest 1,717 in Osterweis Emerging Opportunity on September 12, 2024 and sell it today you would earn a total of 117.00 from holding Osterweis Emerging Opportunity or generate 6.81% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 98.44% |
| Values | Daily Returns |
Sterling Capital Short vs. Osterweis Emerging Opportunity
Performance |
| Timeline |
| Sterling Capital Short |
| Osterweis Emerging |
Sterling Capital and Osterweis Emerging Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sterling Capital and Osterweis Emerging
The main advantage of trading using opposite Sterling Capital and Osterweis Emerging positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sterling Capital position performs unexpectedly, Osterweis Emerging 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 Osterweis Emerging will offset losses from the drop in Osterweis Emerging's long position.| Sterling Capital vs. Goldman Sachs Real | Sterling Capital vs. Guggenheim Risk Managed | Sterling Capital vs. Redwood Real Estate | Sterling Capital vs. Sa Real Estate |
| Osterweis Emerging vs. Fisher Large Cap | Osterweis Emerging vs. Upright Assets Allocation | Osterweis Emerging vs. Old Westbury Large | Osterweis Emerging vs. Enhanced Large Pany |
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 Transaction History module to view history of all your transactions and understand their impact on performance.
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