Correlation Between Summit Global and Boston Partners
Can any of the company-specific risk be diversified away by investing in both Summit Global and Boston Partners 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 Summit Global and Boston Partners into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Summit Global Investments and Boston Partners All Cap, you can compare the effects of market volatilities on Summit Global and Boston Partners 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 Summit Global with a short position of Boston Partners. Check out your portfolio center. Please also check ongoing floating volatility patterns of Summit Global and Boston Partners.
Diversification Opportunities for Summit Global and Boston Partners
0.92 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Summit and Boston is 0.92. Overlapping area represents the amount of risk that can be diversified away by holding Summit Global Investments and Boston Partners All Cap in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Boston Partners All and Summit 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 Summit Global Investments are associated (or correlated) with Boston Partners. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Boston Partners All has no effect on the direction of Summit Global i.e., Summit Global and Boston Partners go up and down completely randomly.
Pair Corralation between Summit Global and Boston Partners
Assuming the 90 days horizon Summit Global Investments is expected to generate 0.83 times more return on investment than Boston Partners. However, Summit Global Investments is 1.2 times less risky than Boston Partners. It trades about 0.42 of its potential returns per unit of risk. Boston Partners All Cap is currently generating about 0.25 per unit of risk. If you would invest 2,124 in Summit Global Investments on September 3, 2024 and sell it today you would earn a total of 146.00 from holding Summit Global Investments or generate 6.87% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Summit Global Investments vs. Boston Partners All Cap
Performance |
| Timeline |
| Summit Global Investments |
| Boston Partners All |
Summit Global and Boston Partners Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Summit Global and Boston Partners
The main advantage of trading using opposite Summit Global and Boston Partners positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Summit Global position performs unexpectedly, Boston Partners 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 Boston Partners will offset losses from the drop in Boston Partners' long position.| Summit Global vs. Summit Global Investments | Summit Global vs. Siit Dynamic Asset | Summit Global vs. Aqr Large Cap | Summit Global vs. Aqr Large Cap |
| Boston Partners vs. Vanguard Value Index | Boston Partners vs. Dodge Cox Stock | Boston Partners vs. American Funds American | Boston Partners vs. American Funds American |
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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
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