Correlation Between Siit Emerging and American Beacon
Can any of the company-specific risk be diversified away by investing in both Siit Emerging and American Beacon 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 Siit Emerging and American Beacon into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Siit Emerging Markets and American Beacon Twentyfour, you can compare the effects of market volatilities on Siit Emerging and American Beacon 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 Siit Emerging with a short position of American Beacon. Check out your portfolio center. Please also check ongoing floating volatility patterns of Siit Emerging and American Beacon.
Diversification Opportunities for Siit Emerging and American Beacon
0.32 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Siit and American is 0.32. Overlapping area represents the amount of risk that can be diversified away by holding Siit Emerging Markets and American Beacon Twentyfour in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on American Beacon Twen and Siit Emerging 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 Siit Emerging Markets are associated (or correlated) with American Beacon. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of American Beacon Twen has no effect on the direction of Siit Emerging i.e., Siit Emerging and American Beacon go up and down completely randomly.
Pair Corralation between Siit Emerging and American Beacon
Assuming the 90 days horizon Siit Emerging Markets is expected to generate 4.49 times more return on investment than American Beacon. However, Siit Emerging is 4.49 times more volatile than American Beacon Twentyfour. It trades about 0.25 of its potential returns per unit of risk. American Beacon Twentyfour is currently generating about 0.36 per unit of risk. If you would invest 833.00 in Siit Emerging Markets on November 5, 2024 and sell it today you would earn a total of 15.00 from holding Siit Emerging Markets or generate 1.8% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Siit Emerging Markets vs. American Beacon Twentyfour
Performance |
| Timeline |
| Siit Emerging Markets |
| American Beacon Twen |
Siit Emerging and American Beacon Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Siit Emerging and American Beacon
The main advantage of trading using opposite Siit Emerging and American Beacon positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Siit Emerging position performs unexpectedly, American Beacon 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 American Beacon will offset losses from the drop in American Beacon's long position.| Siit Emerging vs. Invesco Global Health | Siit Emerging vs. Live Oak Health | Siit Emerging vs. Deutsche Health And | Siit Emerging vs. Highland Longshort Healthcare |
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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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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