Correlation Between Siit High and Precious Metals
Can any of the company-specific risk be diversified away by investing in both Siit High and Precious Metals 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 High and Precious Metals into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Siit High Yield and Precious Metals Ultrasector, you can compare the effects of market volatilities on Siit High and Precious Metals 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 High with a short position of Precious Metals. Check out your portfolio center. Please also check ongoing floating volatility patterns of Siit High and Precious Metals.
Diversification Opportunities for Siit High and Precious Metals
-0.48 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Siit and Precious is -0.48. Overlapping area represents the amount of risk that can be diversified away by holding Siit High Yield and Precious Metals Ultrasector in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Precious Metals Ultr and Siit 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 Siit High Yield are associated (or correlated) with Precious Metals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Precious Metals Ultr has no effect on the direction of Siit High i.e., Siit High and Precious Metals go up and down completely randomly.
Pair Corralation between Siit High and Precious Metals
Assuming the 90 days horizon Siit High Yield is expected to generate 0.07 times more return on investment than Precious Metals. However, Siit High Yield is 14.21 times less risky than Precious Metals. It trades about 0.23 of its potential returns per unit of risk. Precious Metals Ultrasector is currently generating about -0.04 per unit of risk. If you would invest 700.00 in Siit High Yield on September 12, 2024 and sell it today you would earn a total of 20.00 from holding Siit High Yield or generate 2.86% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Siit High Yield vs. Precious Metals Ultrasector
Performance |
| Timeline |
| Siit High Yield |
| Precious Metals Ultr |
Siit High and Precious Metals Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Siit High and Precious Metals
The main advantage of trading using opposite Siit High and Precious Metals positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Siit High position performs unexpectedly, Precious Metals 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 Precious Metals will offset losses from the drop in Precious Metals' long position.| Siit High vs. John Hancock Financial | Siit High vs. Davis Financial Fund | Siit High vs. Goldman Sachs Financial | Siit High vs. Fidelity Advisor Financial |
| Precious Metals vs. Lord Abbett Government | Precious Metals vs. Franklin Adjustable Government | Precious Metals vs. Sit Government Securities | Precious Metals vs. Dunham Porategovernment Bond |
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 Transaction History module to view history of all your transactions and understand their impact on performance.
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