Correlation Between Sterling Capital and Easterly Snow
Can any of the company-specific risk be diversified away by investing in both Sterling Capital and Easterly Snow 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 Easterly Snow into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sterling Capital Total and Easterly Snow Longshort, you can compare the effects of market volatilities on Sterling Capital and Easterly Snow 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 Easterly Snow. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sterling Capital and Easterly Snow.
Diversification Opportunities for Sterling Capital and Easterly Snow
-0.61 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Sterling and Easterly is -0.61. Overlapping area represents the amount of risk that can be diversified away by holding Sterling Capital Total and Easterly Snow Longshort in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Easterly Snow Longshort 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 Total are associated (or correlated) with Easterly Snow. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Easterly Snow Longshort has no effect on the direction of Sterling Capital i.e., Sterling Capital and Easterly Snow go up and down completely randomly.
Pair Corralation between Sterling Capital and Easterly Snow
Assuming the 90 days horizon Sterling Capital Total is expected to generate 0.16 times more return on investment than Easterly Snow. However, Sterling Capital Total is 6.23 times less risky than Easterly Snow. It trades about 0.16 of its potential returns per unit of risk. Easterly Snow Longshort is currently generating about -0.24 per unit of risk. If you would invest 995.00 in Sterling Capital Total on September 15, 2024 and sell it today you would earn a total of 6.00 from holding Sterling Capital Total or generate 0.6% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sterling Capital Total vs. Easterly Snow Longshort
Performance |
| Timeline |
| Sterling Capital Total |
| Easterly Snow Longshort |
Sterling Capital and Easterly Snow Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sterling Capital and Easterly Snow
The main advantage of trading using opposite Sterling Capital and Easterly Snow positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sterling Capital position performs unexpectedly, Easterly Snow 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 Easterly Snow will offset losses from the drop in Easterly Snow's long position.| Sterling Capital vs. Blackrock California Municipal | Sterling Capital vs. Blackrock Balanced Capital | Sterling Capital vs. Blackrock Eurofund Class | Sterling Capital vs. Blackrock Funds |
| Easterly Snow vs. Easterly Snow Small | Easterly Snow vs. Vanguard Windsor Fund | Easterly Snow vs. Pimco Dynamic Income | Easterly Snow vs. Fidelity Magellan Fund |
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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
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