Correlation Between Federated Global and Siit High
Can any of the company-specific risk be diversified away by investing in both Federated Global and Siit High 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 Global and Siit High into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Federated Global Allocation and Siit High Yield, you can compare the effects of market volatilities on Federated Global and Siit High 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 Global with a short position of Siit High. Check out your portfolio center. Please also check ongoing floating volatility patterns of Federated Global and Siit High.
Diversification Opportunities for Federated Global and Siit High
0.29 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Federated and Siit is 0.29. Overlapping area represents the amount of risk that can be diversified away by holding Federated Global Allocation and Siit High Yield in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Siit High Yield and Federated Global 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 Global Allocation are associated (or correlated) with Siit High. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Siit High Yield has no effect on the direction of Federated Global i.e., Federated Global and Siit High go up and down completely randomly.
Pair Corralation between Federated Global and Siit High
Assuming the 90 days horizon Federated Global Allocation is expected to generate 1.84 times more return on investment than Siit High. However, Federated Global is 1.84 times more volatile than Siit High Yield. It trades about 0.25 of its potential returns per unit of risk. Siit High Yield is currently generating about 0.29 per unit of risk. If you would invest 1,945 in Federated Global Allocation on October 30, 2024 and sell it today you would earn a total of 47.00 from holding Federated Global Allocation or generate 2.42% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Federated Global Allocation vs. Siit High Yield
Performance |
| Timeline |
| Federated Global All |
| Siit High Yield |
Federated Global and Siit High Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Federated Global and Siit High
The main advantage of trading using opposite Federated Global and Siit High positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Federated Global position performs unexpectedly, Siit High 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 Siit High will offset losses from the drop in Siit High's long position.| Federated Global vs. Federated Max Cap Index | Federated Global vs. Federated Kaufmann Fund | Federated Global vs. Federated Strategic Income | Federated Global vs. Federated Bond Fund |
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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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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