Correlation Between Strategic Asset and Alger Health
Can any of the company-specific risk be diversified away by investing in both Strategic Asset and Alger Health 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 Strategic Asset and Alger Health into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Strategic Asset Management and Alger Health Sciences, you can compare the effects of market volatilities on Strategic Asset and Alger Health 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 Strategic Asset with a short position of Alger Health. Check out your portfolio center. Please also check ongoing floating volatility patterns of Strategic Asset and Alger Health.
Diversification Opportunities for Strategic Asset and Alger Health
0.24 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Strategic and Alger is 0.24. Overlapping area represents the amount of risk that can be diversified away by holding Strategic Asset Management and Alger Health Sciences in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Alger Health Sciences and Strategic Asset 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 Strategic Asset Management are associated (or correlated) with Alger Health. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Alger Health Sciences has no effect on the direction of Strategic Asset i.e., Strategic Asset and Alger Health go up and down completely randomly.
Pair Corralation between Strategic Asset and Alger Health
Assuming the 90 days horizon Strategic Asset Management is expected to generate 0.48 times more return on investment than Alger Health. However, Strategic Asset Management is 2.06 times less risky than Alger Health. It trades about 0.08 of its potential returns per unit of risk. Alger Health Sciences is currently generating about -0.09 per unit of risk. If you would invest 2,110 in Strategic Asset Management on September 12, 2024 and sell it today you would earn a total of 15.00 from holding Strategic Asset Management or generate 0.71% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
Strategic Asset Management vs. Alger Health Sciences
Performance |
| Timeline |
| Strategic Asset Mana |
| Alger Health Sciences |
Strategic Asset and Alger Health Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Strategic Asset and Alger Health
The main advantage of trading using opposite Strategic Asset and Alger Health positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Strategic Asset position performs unexpectedly, Alger Health 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 Alger Health will offset losses from the drop in Alger Health's long position.| Strategic Asset vs. Queens Road Small | Strategic Asset vs. Palm Valley Capital | Strategic Asset vs. Vanguard Small Cap Value | Strategic Asset vs. Victory Rs Partners |
| Alger Health vs. Siit Global Managed | Alger Health vs. Commonwealth Global Fund | Alger Health vs. Ab Global Real | Alger Health vs. Qs Global Equity |
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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
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