Correlation Between Sterling Capital and Touchstone Ohio
Can any of the company-specific risk be diversified away by investing in both Sterling Capital and Touchstone Ohio 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 Touchstone Ohio 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 Touchstone Ohio Tax, you can compare the effects of market volatilities on Sterling Capital and Touchstone Ohio 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 Touchstone Ohio. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sterling Capital and Touchstone Ohio.
Diversification Opportunities for Sterling Capital and Touchstone Ohio
0.65 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Sterling and Touchstone is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding Sterling Capital Short and Touchstone Ohio Tax in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Touchstone Ohio Tax 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 Touchstone Ohio. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Touchstone Ohio Tax has no effect on the direction of Sterling Capital i.e., Sterling Capital and Touchstone Ohio go up and down completely randomly.
Pair Corralation between Sterling Capital and Touchstone Ohio
Assuming the 90 days horizon Sterling Capital Short is expected to generate 0.71 times more return on investment than Touchstone Ohio. However, Sterling Capital Short is 1.42 times less risky than Touchstone Ohio. It trades about 0.13 of its potential returns per unit of risk. Touchstone Ohio Tax is currently generating about 0.08 per unit of risk. If you would invest 758.00 in Sterling Capital Short on September 3, 2024 and sell it today you would earn a total of 78.00 from holding Sterling Capital Short or generate 10.29% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sterling Capital Short vs. Touchstone Ohio Tax
Performance |
| Timeline |
| Sterling Capital Short |
| Touchstone Ohio Tax |
Sterling Capital and Touchstone Ohio Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sterling Capital and Touchstone Ohio
The main advantage of trading using opposite Sterling Capital and Touchstone Ohio positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sterling Capital position performs unexpectedly, Touchstone Ohio 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 Touchstone Ohio will offset losses from the drop in Touchstone Ohio's long position.| Sterling Capital vs. Europac Gold Fund | Sterling Capital vs. Oppenheimer Gold Special | Sterling Capital vs. Franklin Gold Precious | Sterling Capital vs. Goldman Sachs Short |
| Touchstone Ohio vs. Transamerica Emerging Markets | Touchstone Ohio vs. Morgan Stanley Emerging | Touchstone Ohio vs. Fundvantage Trust | Touchstone Ohio vs. The Emerging Markets |
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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
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