Correlation Between Sa Mkt and Siit High
Can any of the company-specific risk be diversified away by investing in both Sa Mkt and Siit High 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 Sa Mkt and Siit High into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sa Mkt Fd and Siit High Yield, you can compare the effects of market volatilities on Sa Mkt and Siit High 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 Sa Mkt with a short position of Siit High. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sa Mkt and Siit High.
Diversification Opportunities for Sa Mkt and Siit High
Very poor diversification
The 3 months correlation between SAMKX and Siit is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding Sa Mkt Fd and Siit High Yield in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Siit High Yield and Sa Mkt 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 Sa Mkt Fd are associated (or correlated) with Siit High. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Siit High Yield has no effect on the direction of Sa Mkt i.e., Sa Mkt and Siit High go up and down completely randomly.
Pair Corralation between Sa Mkt and Siit High
Assuming the 90 days horizon Sa Mkt Fd is expected to generate 2.38 times more return on investment than Siit High. However, Sa Mkt is 2.38 times more volatile than Siit High Yield. It trades about 0.11 of its potential returns per unit of risk. Siit High Yield is currently generating about 0.12 per unit of risk. If you would invest 2,791 in Sa Mkt Fd on September 12, 2024 and sell it today you would earn a total of 951.00 from holding Sa Mkt Fd or generate 34.07% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sa Mkt Fd vs. Siit High Yield
Performance |
| Timeline |
| Sa Mkt Fd |
| Siit High Yield |
Sa Mkt and Siit High Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sa Mkt and Siit High
The main advantage of trading using opposite Sa Mkt and Siit High positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sa Mkt position performs unexpectedly, Siit High 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 Siit High will offset losses from the drop in Siit High's long position.| Sa Mkt vs. Vanguard Total Stock | Sa Mkt vs. Vanguard 500 Index | Sa Mkt vs. Vanguard Total Stock | Sa Mkt vs. Vanguard Total Stock |
| Siit High vs. John Hancock Financial | Siit High vs. Davis Financial Fund | Siit High vs. Goldman Sachs Financial | Siit High vs. Fidelity Advisor Financial |
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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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