Correlation Between Mirova Global and Sterling Capital
Can any of the company-specific risk be diversified away by investing in both Mirova Global 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 Mirova Global and Sterling Capital into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Mirova Global Green and Sterling Capital Short, you can compare the effects of market volatilities on Mirova Global 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 Mirova Global with a short position of Sterling Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mirova Global and Sterling Capital.
Diversification Opportunities for Mirova Global and Sterling Capital
0.01 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Mirova and Sterling is 0.01. Overlapping area represents the amount of risk that can be diversified away by holding Mirova Global Green and Sterling Capital Short in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sterling Capital Short and Mirova 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 Mirova Global Green 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 Short has no effect on the direction of Mirova Global i.e., Mirova Global and Sterling Capital go up and down completely randomly.
Pair Corralation between Mirova Global and Sterling Capital
Assuming the 90 days horizon Mirova Global is expected to generate 1.1 times less return on investment than Sterling Capital. In addition to that, Mirova Global is 2.23 times more volatile than Sterling Capital Short. It trades about 0.06 of its total potential returns per unit of risk. Sterling Capital Short is currently generating about 0.15 per unit of volatility. If you would invest 761.00 in Sterling Capital Short on November 27, 2024 and sell it today you would earn a total of 76.00 from holding Sterling Capital Short or generate 9.99% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Mirova Global Green vs. Sterling Capital Short
Performance |
| Timeline |
| Mirova Global Green |
| Sterling Capital Short |
Mirova Global and Sterling Capital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Mirova Global and Sterling Capital
The main advantage of trading using opposite Mirova Global and Sterling Capital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mirova Global 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.| Mirova Global vs. Pro Blend Servative Term | Mirova Global vs. Ms Global Fixed | Mirova Global vs. Gmo Global Equity | Mirova Global vs. Nationwide E Plus |
| Sterling Capital vs. World Precious Minerals | Sterling Capital vs. Global Gold Fund | Sterling Capital vs. Investment Managers Series | Sterling Capital vs. Deutsche Gold Precious |
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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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