Correlation Between American Funds and Siit Global
Can any of the company-specific risk be diversified away by investing in both American Funds and Siit Global 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 American Funds and Siit Global into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between American Funds 2020 and Siit Global Managed, you can compare the effects of market volatilities on American Funds and Siit Global 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 American Funds with a short position of Siit Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of American Funds and Siit Global.
Diversification Opportunities for American Funds and Siit Global
0.5 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between American and Siit is 0.5. Overlapping area represents the amount of risk that can be diversified away by holding American Funds 2020 and Siit Global Managed in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Siit Global Managed and American Funds 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 American Funds 2020 are associated (or correlated) with Siit Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Siit Global Managed has no effect on the direction of American Funds i.e., American Funds and Siit Global go up and down completely randomly.
Pair Corralation between American Funds and Siit Global
Assuming the 90 days horizon American Funds is expected to generate 1.98 times less return on investment than Siit Global. But when comparing it to its historical volatility, American Funds 2020 is 1.42 times less risky than Siit Global. It trades about 0.12 of its potential returns per unit of risk. Siit Global Managed is currently generating about 0.17 of returns per unit of risk over similar time horizon. If you would invest 1,151 in Siit Global Managed on September 14, 2024 and sell it today you would earn a total of 127.00 from holding Siit Global Managed or generate 11.03% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
American Funds 2020 vs. Siit Global Managed
Performance |
| Timeline |
| American Funds 2020 |
| Siit Global Managed |
American Funds and Siit Global Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with American Funds and Siit Global
The main advantage of trading using opposite American Funds and Siit Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if American Funds position performs unexpectedly, Siit Global 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 Global will offset losses from the drop in Siit Global's long position.| American Funds vs. Siit Global Managed | American Funds vs. Dreyfusstandish Global Fixed | American Funds vs. Ab Global Risk | American Funds vs. Qs Global Equity |
| Siit Global vs. Simt Multi Asset Accumulation | Siit Global vs. Saat Market Growth | Siit Global vs. Simt Real Return | Siit Global vs. Simt Small Cap |
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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
Other Complementary Tools
| Stock Tickers Use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites | |
| FinTech Suite Use AI to screen and filter profitable investment opportunities | |
| Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas | |
| Sectors List of equity sectors categorizing publicly traded companies based on their primary business activities | |
| Correlation Analysis Reduce portfolio risk simply by holding instruments which are not perfectly correlated |