Correlation Between Sterling Capital and Nasdaq-100(r)
Can any of the company-specific risk be diversified away by investing in both Sterling Capital and Nasdaq-100(r) 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 Nasdaq-100(r) 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 Nasdaq 100 2x Strategy, you can compare the effects of market volatilities on Sterling Capital and Nasdaq-100(r) 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 Nasdaq-100(r). Check out your portfolio center. Please also check ongoing floating volatility patterns of Sterling Capital and Nasdaq-100(r).
Diversification Opportunities for Sterling Capital and Nasdaq-100(r)
0.16 | Correlation Coefficient |
Average diversification
The 3 months correlation between Sterling and Nasdaq-100(r) is 0.16. Overlapping area represents the amount of risk that can be diversified away by holding Sterling Capital Short and Nasdaq 100 2x Strategy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nasdaq 100 2x 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 Nasdaq-100(r). Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nasdaq 100 2x has no effect on the direction of Sterling Capital i.e., Sterling Capital and Nasdaq-100(r) go up and down completely randomly.
Pair Corralation between Sterling Capital and Nasdaq-100(r)
Assuming the 90 days horizon Sterling Capital is expected to generate 7.1 times less return on investment than Nasdaq-100(r). But when comparing it to its historical volatility, Sterling Capital Short is 17.97 times less risky than Nasdaq-100(r). It trades about 0.17 of its potential returns per unit of risk. Nasdaq 100 2x Strategy is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 32,933 in Nasdaq 100 2x Strategy on September 1, 2024 and sell it today you would earn a total of 8,801 from holding Nasdaq 100 2x Strategy or generate 26.72% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sterling Capital Short vs. Nasdaq 100 2x Strategy
Performance |
| Timeline |
| Sterling Capital Short |
| Nasdaq 100 2x |
Sterling Capital and Nasdaq-100(r) Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sterling Capital and Nasdaq-100(r)
The main advantage of trading using opposite Sterling Capital and Nasdaq-100(r) positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sterling Capital position performs unexpectedly, Nasdaq-100(r) 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 Nasdaq-100(r) will offset losses from the drop in Nasdaq-100(r)'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 |
| Nasdaq-100(r) vs. Bbh Partner Fund | Nasdaq-100(r) vs. Volumetric Fund Volumetric | Nasdaq-100(r) vs. Commonwealth Global Fund | Nasdaq-100(r) vs. Ab Value 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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
Other Complementary Tools
| My Watchlist Analysis Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like | |
| Money Managers Screen money managers from public funds and ETFs managed around the world | |
| Idea Optimizer Use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio | |
| Bonds Directory Find actively traded corporate debentures issued by US companies | |
| Piotroski F Score Get Piotroski F Score based on the binary analysis strategy of nine different fundamentals |