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 Mid, 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
0.1 | Correlation Coefficient |
Average diversification
The 3 months correlation between Mirova and Sterling is 0.1. Overlapping area represents the amount of risk that can be diversified away by holding Mirova Global Green and Sterling Capital Mid in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sterling Capital Mid 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 Mid 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 3.01 times less return on investment than Sterling Capital. But when comparing it to its historical volatility, Mirova Global Green is 5.18 times less risky than Sterling Capital. It trades about 0.46 of its potential returns per unit of risk. Sterling Capital Mid is currently generating about 0.27 of returns per unit of risk over similar time horizon. If you would invest 1,639 in Sterling Capital Mid on September 4, 2024 and sell it today you would earn a total of 101.00 from holding Sterling Capital Mid or generate 6.16% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 95.24% |
| Values | Daily Returns |
Mirova Global Green vs. Sterling Capital Mid
Performance |
| Timeline |
| Mirova Global Green |
| Sterling Capital Mid |
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. Hood River New | Mirova Global vs. T Rowe Price | Mirova Global vs. T Rowe Price | Mirova Global vs. T Rowe Price |
| 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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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