Correlation Between SAIHEAT and Steven Madden
Can any of the company-specific risk be diversified away by investing in both SAIHEAT and Steven Madden 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 SAIHEAT and Steven Madden into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SAIHEAT Limited and Steven Madden, you can compare the effects of market volatilities on SAIHEAT and Steven Madden 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 SAIHEAT with a short position of Steven Madden. Check out your portfolio center. Please also check ongoing floating volatility patterns of SAIHEAT and Steven Madden.
Diversification Opportunities for SAIHEAT and Steven Madden
-0.53 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between SAIHEAT and Steven is -0.53. Overlapping area represents the amount of risk that can be diversified away by holding SAIHEAT Limited and Steven Madden in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Steven Madden and SAIHEAT 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 SAIHEAT Limited are associated (or correlated) with Steven Madden. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Steven Madden has no effect on the direction of SAIHEAT i.e., SAIHEAT and Steven Madden go up and down completely randomly.
Pair Corralation between SAIHEAT and Steven Madden
Given the investment horizon of 90 days SAIHEAT Limited is expected to under-perform the Steven Madden. In addition to that, SAIHEAT is 3.83 times more volatile than Steven Madden. It trades about -0.27 of its total potential returns per unit of risk. Steven Madden is currently generating about -0.06 per unit of volatility. If you would invest 4,497 in Steven Madden on September 13, 2024 and sell it today you would lose (119.00) from holding Steven Madden or give up 2.65% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
SAIHEAT Limited vs. Steven Madden
Performance |
| Timeline |
| SAIHEAT Limited |
| Steven Madden |
SAIHEAT and Steven Madden Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SAIHEAT and Steven Madden
The main advantage of trading using opposite SAIHEAT and Steven Madden positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SAIHEAT position performs unexpectedly, Steven Madden 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 Steven Madden will offset losses from the drop in Steven Madden's long position.| SAIHEAT vs. Cheniere Energy Partners | SAIHEAT vs. Transportadora de Gas | SAIHEAT vs. NiSource | SAIHEAT vs. CECO Environmental Corp |
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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 Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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