Correlation Between Sentinel Small and Delaware Value
Can any of the company-specific risk be diversified away by investing in both Sentinel Small and Delaware Value 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 Sentinel Small and Delaware Value into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sentinel Small Pany and Delaware Value Fund, you can compare the effects of market volatilities on Sentinel Small and Delaware Value 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 Sentinel Small with a short position of Delaware Value. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sentinel Small and Delaware Value.
Diversification Opportunities for Sentinel Small and Delaware Value
0.87 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Sentinel and Delaware is 0.87. Overlapping area represents the amount of risk that can be diversified away by holding Sentinel Small Pany and Delaware Value Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Delaware Value and Sentinel Small 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 Sentinel Small Pany are associated (or correlated) with Delaware Value. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Delaware Value has no effect on the direction of Sentinel Small i.e., Sentinel Small and Delaware Value go up and down completely randomly.
Pair Corralation between Sentinel Small and Delaware Value
Assuming the 90 days horizon Sentinel Small Pany is expected to generate 1.88 times more return on investment than Delaware Value. However, Sentinel Small is 1.88 times more volatile than Delaware Value Fund. It trades about 0.24 of its potential returns per unit of risk. Delaware Value Fund is currently generating about 0.23 per unit of risk. If you would invest 723.00 in Sentinel Small Pany on August 29, 2024 and sell it today you would earn a total of 57.00 from holding Sentinel Small Pany or generate 7.88% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sentinel Small Pany vs. Delaware Value Fund
Performance |
| Timeline |
| Sentinel Small Pany |
| Delaware Value |
Sentinel Small and Delaware Value Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sentinel Small and Delaware Value
The main advantage of trading using opposite Sentinel Small and Delaware Value positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sentinel Small position performs unexpectedly, Delaware Value 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 Delaware Value will offset losses from the drop in Delaware Value's long position.| Sentinel Small vs. Vanguard Small Cap Index | Sentinel Small vs. Vanguard Small Cap Index | Sentinel Small vs. Vanguard Small Cap Index | Sentinel Small vs. Vanguard Small Cap Index |
| Delaware Value vs. Blackrock Sm Cap | Delaware Value vs. Adams Diversified Equity | Delaware Value vs. Tax Managed Mid Small | Delaware Value vs. Sentinel Small Pany |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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