Correlation Between Affiliated Managers and Strats SM
Can any of the company-specific risk be diversified away by investing in both Affiliated Managers and Strats SM 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 Affiliated Managers and Strats SM into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Affiliated Managers Group and Strats SM Trust, you can compare the effects of market volatilities on Affiliated Managers and Strats SM 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 Affiliated Managers with a short position of Strats SM. Check out your portfolio center. Please also check ongoing floating volatility patterns of Affiliated Managers and Strats SM.
Diversification Opportunities for Affiliated Managers and Strats SM
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Affiliated and Strats is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Affiliated Managers Group and Strats SM Trust in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Strats SM Trust and Affiliated Managers 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 Affiliated Managers Group are associated (or correlated) with Strats SM. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Strats SM Trust has no effect on the direction of Affiliated Managers i.e., Affiliated Managers and Strats SM go up and down completely randomly.
Pair Corralation between Affiliated Managers and Strats SM
Considering the 90-day investment horizon Affiliated Managers Group is expected to generate 2.35 times more return on investment than Strats SM. However, Affiliated Managers is 2.35 times more volatile than Strats SM Trust. It trades about 0.17 of its potential returns per unit of risk. Strats SM Trust is currently generating about 0.1 per unit of risk. If you would invest 2,235 in Affiliated Managers Group on November 3, 2024 and sell it today you would earn a total of 82.00 from holding Affiliated Managers Group or generate 3.67% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 95.24% |
| Values | Daily Returns |
Affiliated Managers Group vs. Strats SM Trust
Performance |
| Timeline |
| Affiliated Managers |
| Strats SM Trust |
Affiliated Managers and Strats SM Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Affiliated Managers and Strats SM
The main advantage of trading using opposite Affiliated Managers and Strats SM positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Affiliated Managers position performs unexpectedly, Strats SM 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 Strats SM will offset losses from the drop in Strats SM's long position.| Affiliated Managers vs. DBA Sempra 5750 | Affiliated Managers vs. CMS Energy Corp | Affiliated Managers vs. American Financial Group | Affiliated Managers vs. National Rural Utilities |
| Strats SM vs. STRATS SM Trust | Strats SM vs. STRATSSM Certificates series | Strats SM vs. SYNTHETIC FIXED INCOME | Strats SM vs. Strats SM Trust |
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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
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