Correlation Between Fa 529 and Sterling Capital
Can any of the company-specific risk be diversified away by investing in both Fa 529 and Sterling Capital 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 Fa 529 and Sterling Capital into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Fa 529 Aggressive and Sterling Capital Intermediate, you can compare the effects of market volatilities on Fa 529 and Sterling Capital 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 Fa 529 with a short position of Sterling Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fa 529 and Sterling Capital.
Diversification Opportunities for Fa 529 and Sterling Capital
-0.51 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between FFCGX and Sterling is -0.51. Overlapping area represents the amount of risk that can be diversified away by holding Fa 529 Aggressive and Sterling Capital Intermediate in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sterling Capital Int and Fa 529 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 Fa 529 Aggressive are associated (or correlated) with Sterling Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sterling Capital Int has no effect on the direction of Fa 529 i.e., Fa 529 and Sterling Capital go up and down completely randomly.
Pair Corralation between Fa 529 and Sterling Capital
Assuming the 90 days horizon Fa 529 Aggressive is expected to generate 3.24 times more return on investment than Sterling Capital. However, Fa 529 is 3.24 times more volatile than Sterling Capital Intermediate. It trades about 0.08 of its potential returns per unit of risk. Sterling Capital Intermediate is currently generating about 0.11 per unit of risk. If you would invest 3,751 in Fa 529 Aggressive on September 1, 2024 and sell it today you would earn a total of 296.00 from holding Fa 529 Aggressive or generate 7.89% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 99.21% |
| Values | Daily Returns |
Fa 529 Aggressive vs. Sterling Capital Intermediate
Performance |
| Timeline |
| Fa 529 Aggressive |
| Sterling Capital Int |
Fa 529 and Sterling Capital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fa 529 and Sterling Capital
The main advantage of trading using opposite Fa 529 and Sterling Capital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fa 529 position performs unexpectedly, Sterling Capital 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 Sterling Capital will offset losses from the drop in Sterling Capital's long position.| Fa 529 vs. Vanguard Total Stock | Fa 529 vs. Vanguard 500 Index | Fa 529 vs. Vanguard Total Stock | Fa 529 vs. Vanguard Total Stock |
| Sterling Capital vs. Sterling Capital Equity | Sterling Capital vs. Sterling Capital Behavioral | Sterling Capital vs. Sterling Capital Behavioral | Sterling Capital vs. Sterling Capital Behavioral |
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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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