Correlation Between Sterling Capital and Amg River
Can any of the company-specific risk be diversified away by investing in both Sterling Capital and Amg River 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 Amg River into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sterling Capital Intermediate and Amg River Road, you can compare the effects of market volatilities on Sterling Capital and Amg River 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 Amg River. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sterling Capital and Amg River.
Diversification Opportunities for Sterling Capital and Amg River
-0.54 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Sterling and Amg is -0.54. Overlapping area represents the amount of risk that can be diversified away by holding Sterling Capital Intermediate and Amg River Road in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Amg River Road 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 Intermediate are associated (or correlated) with Amg River. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Amg River Road has no effect on the direction of Sterling Capital i.e., Sterling Capital and Amg River go up and down completely randomly.
Pair Corralation between Sterling Capital and Amg River
Assuming the 90 days horizon Sterling Capital Intermediate is expected to under-perform the Amg River. But the mutual fund apears to be less risky and, when comparing its historical volatility, Sterling Capital Intermediate is 4.65 times less risky than Amg River. The mutual fund trades about -0.12 of its potential returns per unit of risk. The Amg River Road is currently generating about 0.23 of returns per unit of risk over similar time horizon. If you would invest 1,506 in Amg River Road on September 12, 2024 and sell it today you would earn a total of 240.00 from holding Amg River Road or generate 15.94% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 98.44% |
| Values | Daily Returns |
Sterling Capital Intermediate vs. Amg River Road
Performance |
| Timeline |
| Sterling Capital Int |
| Amg River Road |
Sterling Capital and Amg River Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sterling Capital and Amg River
The main advantage of trading using opposite Sterling Capital and Amg River positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sterling Capital position performs unexpectedly, Amg River 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 Amg River will offset losses from the drop in Amg River's long position.| Sterling Capital vs. Touchstone Ultra Short | Sterling Capital vs. Angel Oak Ultrashort | Sterling Capital vs. Kentucky Tax Free Short To Medium | Sterling Capital vs. Siit Ultra Short |
| Amg River vs. Vanguard Small Cap Value | Amg River vs. Vanguard Small Cap Value | Amg River vs. Us Small Cap | Amg River vs. Us Targeted Value |
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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
Other Complementary Tools
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
| Price Transformation Use Price Transformation models to analyze the depth of different equity instruments across global markets | |
| Portfolio Center All portfolio management and optimization tools to improve performance of your portfolios | |
| Bonds Directory Find actively traded corporate debentures issued by US companies | |
| Watchlist Optimization Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm |