Correlation Between Stet Intermediate and Sit Emerging
Can any of the company-specific risk be diversified away by investing in both Stet Intermediate and Sit Emerging 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 Stet Intermediate and Sit Emerging into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Stet Intermediate Term and Sit Emerging Markets, you can compare the effects of market volatilities on Stet Intermediate and Sit Emerging 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 Stet Intermediate with a short position of Sit Emerging. Check out your portfolio center. Please also check ongoing floating volatility patterns of Stet Intermediate and Sit Emerging.
Diversification Opportunities for Stet Intermediate and Sit Emerging
0.26 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Stet and Sit is 0.26. Overlapping area represents the amount of risk that can be diversified away by holding Stet Intermediate Term and Sit Emerging Markets in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sit Emerging Markets and Stet Intermediate 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 Stet Intermediate Term are associated (or correlated) with Sit Emerging. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sit Emerging Markets has no effect on the direction of Stet Intermediate i.e., Stet Intermediate and Sit Emerging go up and down completely randomly.
Pair Corralation between Stet Intermediate and Sit Emerging
Assuming the 90 days horizon Stet Intermediate is expected to generate 2.07 times less return on investment than Sit Emerging. But when comparing it to its historical volatility, Stet Intermediate Term is 4.45 times less risky than Sit Emerging. It trades about 0.08 of its potential returns per unit of risk. Sit Emerging Markets is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 993.00 in Sit Emerging Markets on August 26, 2024 and sell it today you would earn a total of 145.00 from holding Sit Emerging Markets or generate 14.6% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Stet Intermediate Term vs. Sit Emerging Markets
Performance |
| Timeline |
| Stet Intermediate Term |
| Sit Emerging Markets |
Stet Intermediate and Sit Emerging Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Stet Intermediate and Sit Emerging
The main advantage of trading using opposite Stet Intermediate and Sit Emerging positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Stet Intermediate position performs unexpectedly, Sit Emerging 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 Sit Emerging will offset losses from the drop in Sit Emerging's long position.| Stet Intermediate vs. Sit International Equity | Stet Intermediate vs. Intermediate Taxamt Free Fund | Stet Intermediate vs. Goldman Sachs Short | Stet Intermediate vs. Simt High Yield |
| Sit Emerging vs. Sit International Equity | Sit Emerging vs. Simt E Fixed | Sit Emerging vs. Simt Multi Asset Income | Sit Emerging vs. Simt Global Managed |
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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
Other Complementary Tools
| USA ETFs Find actively traded Exchange Traded Funds (ETF) in USA | |
| Cryptocurrency Center Build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency | |
| Analyst Advice Analyst recommendations and target price estimates broken down by several categories | |
| Portfolio Rebalancing Analyze risk-adjusted returns against different time horizons to find asset-allocation targets | |
| Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings |