Correlation Between American Funds and Siit Multi
Can any of the company-specific risk be diversified away by investing in both American Funds and Siit Multi 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 Funds and Siit Multi into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between American Funds Inflation and Siit Multi Asset Real, you can compare the effects of market volatilities on American Funds and Siit Multi 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 Funds with a short position of Siit Multi. Check out your portfolio center. Please also check ongoing floating volatility patterns of American Funds and Siit Multi.
Diversification Opportunities for American Funds and Siit Multi
0.63 | Correlation Coefficient |
Poor diversification
The 3 months correlation between American and Siit is 0.63. Overlapping area represents the amount of risk that can be diversified away by holding American Funds Inflation and Siit Multi Asset Real in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Siit Multi Asset and American Funds 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 Funds Inflation are associated (or correlated) with Siit Multi. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Siit Multi Asset has no effect on the direction of American Funds i.e., American Funds and Siit Multi go up and down completely randomly.
Pair Corralation between American Funds and Siit Multi
Assuming the 90 days horizon American Funds is expected to generate 1.01 times less return on investment than Siit Multi. But when comparing it to its historical volatility, American Funds Inflation is 1.1 times less risky than Siit Multi. It trades about 0.12 of its potential returns per unit of risk. Siit Multi Asset Real is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest 741.00 in Siit Multi Asset Real on September 12, 2024 and sell it today you would earn a total of 4.00 from holding Siit Multi Asset Real or generate 0.54% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
American Funds Inflation vs. Siit Multi Asset Real
Performance |
| Timeline |
| American Funds Inflation |
| Siit Multi Asset |
American Funds and Siit Multi Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with American Funds and Siit Multi
The main advantage of trading using opposite American Funds and Siit Multi positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if American Funds position performs unexpectedly, Siit Multi 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 Siit Multi will offset losses from the drop in Siit Multi's long position.| American Funds vs. Franklin High Income | American Funds vs. Ab Global Risk | American Funds vs. Alliancebernstein Global High | American Funds vs. Fa 529 Aggressive |
| Siit Multi vs. Vanguard Inflation Protected Securities | Siit Multi vs. Vanguard Inflation Protected Securities | Siit Multi vs. American Funds Inflation | Siit Multi vs. American Funds Inflation |
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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
Other Complementary Tools
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets | |
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine | |
| Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk | |
| Portfolio Suggestion Get suggestions outside of your existing asset allocation including your own model portfolios | |
| Money Managers Screen money managers from public funds and ETFs managed around the world |