Correlation Between Federated Institutional and Saat Moderate
Can any of the company-specific risk be diversified away by investing in both Federated Institutional and Saat Moderate 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 Federated Institutional and Saat Moderate into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Federated Institutional High and Saat Moderate Strategy, you can compare the effects of market volatilities on Federated Institutional and Saat Moderate 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 Federated Institutional with a short position of Saat Moderate. Check out your portfolio center. Please also check ongoing floating volatility patterns of Federated Institutional and Saat Moderate.
Diversification Opportunities for Federated Institutional and Saat Moderate
0.53 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Federated and Saat is 0.53. Overlapping area represents the amount of risk that can be diversified away by holding Federated Institutional High and Saat Moderate Strategy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Saat Moderate Strategy and Federated Institutional 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 Federated Institutional High are associated (or correlated) with Saat Moderate. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Saat Moderate Strategy has no effect on the direction of Federated Institutional i.e., Federated Institutional and Saat Moderate go up and down completely randomly.
Pair Corralation between Federated Institutional and Saat Moderate
Assuming the 90 days horizon Federated Institutional High is expected to generate 0.57 times more return on investment than Saat Moderate. However, Federated Institutional High is 1.76 times less risky than Saat Moderate. It trades about 0.1 of its potential returns per unit of risk. Saat Moderate Strategy is currently generating about 0.02 per unit of risk. If you would invest 892.00 in Federated Institutional High on September 13, 2024 and sell it today you would earn a total of 5.00 from holding Federated Institutional High or generate 0.56% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Federated Institutional High vs. Saat Moderate Strategy
Performance |
| Timeline |
| Federated Institutional |
| Saat Moderate Strategy |
Federated Institutional and Saat Moderate Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Federated Institutional and Saat Moderate
The main advantage of trading using opposite Federated Institutional and Saat Moderate positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Federated Institutional position performs unexpectedly, Saat Moderate 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 Saat Moderate will offset losses from the drop in Saat Moderate's long position.The idea behind Federated Institutional High and Saat Moderate Strategy pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
| Saat Moderate vs. Simt Multi Asset Accumulation | Saat Moderate vs. Saat Market Growth | Saat Moderate vs. Simt Real Return | Saat Moderate vs. Simt Small Cap |
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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
Other Complementary Tools
| Commodity Channel Use Commodity Channel Index to analyze current equity momentum | |
| Portfolio Center All portfolio management and optimization tools to improve performance of your portfolios | |
| Price Ceiling Movement Calculate and plot Price Ceiling Movement for different equity instruments | |
| Theme Ratings Determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Investing Opportunities Build portfolios using our predefined set of ideas and optimize them against your investing preferences |