Correlation Between Simt Multi and Stet Intermediate
Can any of the company-specific risk be diversified away by investing in both Simt Multi and Stet Intermediate 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 Intermediate 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 Intermediate Term, you can compare the effects of market volatilities on Simt Multi and Stet Intermediate 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 Intermediate. Check out your portfolio center. Please also check ongoing floating volatility patterns of Simt Multi and Stet Intermediate.
Diversification Opportunities for Simt Multi and Stet Intermediate
0.7 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Simt and Stet is 0.7. Overlapping area represents the amount of risk that can be diversified away by holding Simt Multi Asset Accumulation and Stet Intermediate Term in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Stet Intermediate Term 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 Intermediate. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Stet Intermediate Term has no effect on the direction of Simt Multi i.e., Simt Multi and Stet Intermediate go up and down completely randomly.
Pair Corralation between Simt Multi and Stet Intermediate
Assuming the 90 days horizon Simt Multi Asset Accumulation is expected to generate 2.74 times more return on investment than Stet Intermediate. However, Simt Multi is 2.74 times more volatile than Stet Intermediate Term. It trades about 0.05 of its potential returns per unit of risk. Stet Intermediate Term is currently generating about 0.09 per unit of risk. If you would invest 680.00 in Simt Multi Asset Accumulation on August 26, 2024 and sell it today you would earn a total of 58.00 from holding Simt Multi Asset Accumulation or generate 8.53% 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 Intermediate Term
Performance |
| Timeline |
| Simt Multi Asset |
| Stet Intermediate Term |
Simt Multi and Stet Intermediate Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Simt Multi and Stet Intermediate
The main advantage of trading using opposite Simt Multi and Stet Intermediate positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Simt Multi position performs unexpectedly, Stet Intermediate 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 Intermediate will offset losses from the drop in Stet Intermediate's long position.| Simt Multi vs. Saat Market Growth | Simt Multi vs. Simt Real Return | Simt Multi vs. Simt Small Cap | Simt Multi vs. Siit Screened World |
| Stet Intermediate vs. Sit International Equity | Stet Intermediate vs. Intermediate Taxamt Free Fund | Stet Intermediate vs. Goldman Sachs Short | Stet Intermediate vs. Simt High Yield |
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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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