Correlation Between Simt Multi-asset and Columbia Dividend
Can any of the company-specific risk be diversified away by investing in both Simt Multi-asset and Columbia Dividend 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 Multi-asset and Columbia Dividend into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Simt Multi Asset Inflation and Columbia Dividend Income, you can compare the effects of market volatilities on Simt Multi-asset and Columbia Dividend 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 Multi-asset with a short position of Columbia Dividend. Check out your portfolio center. Please also check ongoing floating volatility patterns of Simt Multi-asset and Columbia Dividend.
Diversification Opportunities for Simt Multi-asset and Columbia Dividend
0.36 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Simt and Columbia is 0.36. Overlapping area represents the amount of risk that can be diversified away by holding Simt Multi Asset Inflation and Columbia Dividend Income in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Columbia Dividend Income and Simt Multi-asset 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 Multi Asset Inflation are associated (or correlated) with Columbia Dividend. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Columbia Dividend Income has no effect on the direction of Simt Multi-asset i.e., Simt Multi-asset and Columbia Dividend go up and down completely randomly.
Pair Corralation between Simt Multi-asset and Columbia Dividend
Assuming the 90 days horizon Simt Multi-asset is expected to generate 1.36 times less return on investment than Columbia Dividend. But when comparing it to its historical volatility, Simt Multi Asset Inflation is 3.16 times less risky than Columbia Dividend. It trades about 0.64 of its potential returns per unit of risk. Columbia Dividend Income is currently generating about 0.28 of returns per unit of risk over similar time horizon. If you would invest 3,314 in Columbia Dividend Income on October 24, 2024 and sell it today you would earn a total of 112.00 from holding Columbia Dividend Income or generate 3.38% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Simt Multi Asset Inflation vs. Columbia Dividend Income
Performance |
| Timeline |
| Simt Multi Asset |
| Columbia Dividend Income |
Simt Multi-asset and Columbia Dividend Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Simt Multi-asset and Columbia Dividend
The main advantage of trading using opposite Simt Multi-asset and Columbia Dividend positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Simt Multi-asset position performs unexpectedly, Columbia Dividend 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 Columbia Dividend will offset losses from the drop in Columbia Dividend's long position.| Simt Multi-asset vs. Advent Claymore Convertible | Simt Multi-asset vs. Columbia Convertible Securities | Simt Multi-asset vs. Allianzgi Convertible Income | Simt Multi-asset vs. Rationalpier 88 Convertible |
| Columbia Dividend vs. Great West Inflation Protected Securities | Columbia Dividend vs. Aqr Managed Futures | Columbia Dividend vs. Simt Multi Asset Inflation | Columbia Dividend vs. Ab Bond Inflation |
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 Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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