Correlation Between Simt Multi and Stet California
Can any of the company-specific risk be diversified away by investing in both Simt Multi and Stet California 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 Simt Multi and Stet California into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Simt Multi Asset Accumulation and Stet California Municipal, you can compare the effects of market volatilities on Simt Multi and Stet California 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 Simt Multi with a short position of Stet California. Check out your portfolio center. Please also check ongoing floating volatility patterns of Simt Multi and Stet California.
Diversification Opportunities for Simt Multi and Stet California
0.78 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Simt and Stet is 0.78. Overlapping area represents the amount of risk that can be diversified away by holding Simt Multi Asset Accumulation and Stet California Municipal in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Stet California Municipal and Simt Multi 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 Simt Multi Asset Accumulation are associated (or correlated) with Stet California. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Stet California Municipal has no effect on the direction of Simt Multi i.e., Simt Multi and Stet California go up and down completely randomly.
Pair Corralation between Simt Multi and Stet California
Assuming the 90 days horizon Simt Multi Asset Accumulation is expected to generate 2.76 times more return on investment than Stet California. However, Simt Multi is 2.76 times more volatile than Stet California Municipal. It trades about 0.05 of its potential returns per unit of risk. Stet California Municipal is currently generating about 0.06 per unit of risk. If you would invest 661.00 in Simt Multi Asset Accumulation on September 12, 2024 and sell it today you would earn a total of 91.00 from holding Simt Multi Asset Accumulation or generate 13.77% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Simt Multi Asset Accumulation vs. Stet California Municipal
Performance |
| Timeline |
| Simt Multi Asset |
| Stet California Municipal |
Simt Multi and Stet California Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Simt Multi and Stet California
The main advantage of trading using opposite Simt Multi and Stet California positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Simt Multi position performs unexpectedly, Stet California 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 Stet California will offset losses from the drop in Stet California's long position.| Simt Multi vs. Morningstar Aggressive Growth | Simt Multi vs. Alliancebernstein Global High | Simt Multi vs. California High Yield Municipal | Simt Multi vs. Ppm High Yield |
| Stet California vs. Pace High Yield | Stet California vs. Ishares Municipal Bond | Stet California vs. Ambrus Core Bond | Stet California vs. Bbh Intermediate Municipal |
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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
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