Correlation Between Commodities Strategy and Simt Multi-asset
Can any of the company-specific risk be diversified away by investing in both Commodities Strategy and Simt Multi-asset 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 Commodities Strategy and Simt Multi-asset into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Commodities Strategy Fund and Simt Multi Asset Accumulation, you can compare the effects of market volatilities on Commodities Strategy and Simt Multi-asset 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 Commodities Strategy with a short position of Simt Multi-asset. Check out your portfolio center. Please also check ongoing floating volatility patterns of Commodities Strategy and Simt Multi-asset.
Diversification Opportunities for Commodities Strategy and Simt Multi-asset
0.28 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Commodities and Simt is 0.28. Overlapping area represents the amount of risk that can be diversified away by holding Commodities Strategy Fund and Simt Multi Asset Accumulation in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Simt Multi Asset and Commodities Strategy 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 Commodities Strategy Fund are associated (or correlated) with Simt Multi-asset. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Simt Multi Asset has no effect on the direction of Commodities Strategy i.e., Commodities Strategy and Simt Multi-asset go up and down completely randomly.
Pair Corralation between Commodities Strategy and Simt Multi-asset
Assuming the 90 days horizon Commodities Strategy Fund is expected to under-perform the Simt Multi-asset. In addition to that, Commodities Strategy is 1.73 times more volatile than Simt Multi Asset Accumulation. It trades about -0.12 of its total potential returns per unit of risk. Simt Multi Asset Accumulation is currently generating about 0.27 per unit of volatility. If you would invest 737.00 in Simt Multi Asset Accumulation on September 4, 2024 and sell it today you would earn a total of 19.00 from holding Simt Multi Asset Accumulation or generate 2.58% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 95.24% |
| Values | Daily Returns |
Commodities Strategy Fund vs. Simt Multi Asset Accumulation
Performance |
| Timeline |
| Commodities Strategy |
| Simt Multi Asset |
Commodities Strategy and Simt Multi-asset Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Commodities Strategy and Simt Multi-asset
The main advantage of trading using opposite Commodities Strategy and Simt Multi-asset positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Commodities Strategy position performs unexpectedly, Simt Multi-asset 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 Simt Multi-asset will offset losses from the drop in Simt Multi-asset's long position.| Commodities Strategy vs. Basic Materials Fund | Commodities Strategy vs. Energy Services Fund | Commodities Strategy vs. Energy Fund Investor | Commodities Strategy vs. Real Estate Fund |
| Simt Multi-asset vs. Simt Multi Asset Accumulation | Simt Multi-asset vs. Saat Market Growth | Simt Multi-asset vs. Simt Real Return | Simt Multi-asset 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 Portfolio Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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