Correlation Between Simt High and Old Westbury
Can any of the company-specific risk be diversified away by investing in both Simt High and Old Westbury 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 High and Old Westbury into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Simt High Yield and Old Westbury Large, you can compare the effects of market volatilities on Simt High and Old Westbury 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 High with a short position of Old Westbury. Check out your portfolio center. Please also check ongoing floating volatility patterns of Simt High and Old Westbury.
Diversification Opportunities for Simt High and Old Westbury
0.4 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Simt and Old is 0.4. Overlapping area represents the amount of risk that can be diversified away by holding Simt High Yield and Old Westbury Large in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Old Westbury Large and Simt High 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 High Yield are associated (or correlated) with Old Westbury. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Old Westbury Large has no effect on the direction of Simt High i.e., Simt High and Old Westbury go up and down completely randomly.
Pair Corralation between Simt High and Old Westbury
Assuming the 90 days horizon Simt High Yield is expected to generate 0.13 times more return on investment than Old Westbury. However, Simt High Yield is 7.59 times less risky than Old Westbury. It trades about -0.27 of its potential returns per unit of risk. Old Westbury Large is currently generating about -0.33 per unit of risk. If you would invest 519.00 in Simt High Yield on October 15, 2024 and sell it today you would lose (5.00) from holding Simt High Yield or give up 0.96% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Simt High Yield vs. Old Westbury Large
Performance |
| Timeline |
| Simt High Yield |
| Old Westbury Large |
Simt High and Old Westbury Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Simt High and Old Westbury
The main advantage of trading using opposite Simt High and Old Westbury positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Simt High position performs unexpectedly, Old Westbury 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 Old Westbury will offset losses from the drop in Old Westbury's long position.| Simt High vs. Artisan High Income | Simt High vs. Sit Emerging Markets | Simt High vs. Sit International Equity | Simt High vs. Stet Intermediate Term |
| Old Westbury vs. Simt High Yield | Old Westbury vs. Buffalo High Yield | Old Westbury vs. Msift High Yield | Old Westbury vs. Virtus 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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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