Correlation Between Emerging Markets and Siit High
Can any of the company-specific risk be diversified away by investing in both Emerging Markets and Siit High 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 Emerging Markets and Siit High into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Emerging Markets Fund and Siit High Yield, you can compare the effects of market volatilities on Emerging Markets and Siit High 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 Emerging Markets with a short position of Siit High. Check out your portfolio center. Please also check ongoing floating volatility patterns of Emerging Markets and Siit High.
Diversification Opportunities for Emerging Markets and Siit High
-0.07 | Correlation Coefficient |
Good diversification
The 3 months correlation between Emerging and Siit is -0.07. Overlapping area represents the amount of risk that can be diversified away by holding Emerging Markets Fund and Siit High Yield in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Siit High Yield and Emerging Markets 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 Emerging Markets Fund are associated (or correlated) with Siit High. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Siit High Yield has no effect on the direction of Emerging Markets i.e., Emerging Markets and Siit High go up and down completely randomly.
Pair Corralation between Emerging Markets and Siit High
Assuming the 90 days horizon Emerging Markets Fund is expected to under-perform the Siit High. In addition to that, Emerging Markets is 3.45 times more volatile than Siit High Yield. It trades about -0.02 of its total potential returns per unit of risk. Siit High Yield is currently generating about 0.15 per unit of volatility. If you would invest 704.00 in Siit High Yield on November 2, 2024 and sell it today you would earn a total of 14.00 from holding Siit High Yield or generate 1.99% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Emerging Markets Fund vs. Siit High Yield
Performance |
| Timeline |
| Emerging Markets |
| Siit High Yield |
Emerging Markets and Siit High Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Emerging Markets and Siit High
The main advantage of trading using opposite Emerging Markets and Siit High positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Emerging Markets position performs unexpectedly, Siit High 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 High will offset losses from the drop in Siit High's long position.| Emerging Markets vs. Blackrock All Cap Energy | Emerging Markets vs. Franklin Natural Resources | Emerging Markets vs. Oil Gas Ultrasector | Emerging Markets vs. Adams Natural Resources |
| Siit High vs. Fidelity Advisor Technology | Siit High vs. Blackrock Science Technology | Siit High vs. Firsthand Technology Opportunities | Siit High vs. Invesco Technology Fund |
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 Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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