Correlation Between Siit Emerging and Payden Emerging
Can any of the company-specific risk be diversified away by investing in both Siit Emerging and Payden 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 Siit Emerging and Payden Emerging into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Siit Emerging Markets and Payden Emerging Markets, you can compare the effects of market volatilities on Siit Emerging and Payden 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 Siit Emerging with a short position of Payden Emerging. Check out your portfolio center. Please also check ongoing floating volatility patterns of Siit Emerging and Payden Emerging.
Diversification Opportunities for Siit Emerging and Payden Emerging
0.82 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Siit and Payden is 0.82. Overlapping area represents the amount of risk that can be diversified away by holding Siit Emerging Markets and Payden Emerging Markets in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Payden Emerging Markets and Siit Emerging 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 Emerging Markets are associated (or correlated) with Payden Emerging. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Payden Emerging Markets has no effect on the direction of Siit Emerging i.e., Siit Emerging and Payden Emerging go up and down completely randomly.
Pair Corralation between Siit Emerging and Payden Emerging
Assuming the 90 days horizon Siit Emerging Markets is expected to under-perform the Payden Emerging. In addition to that, Siit Emerging is 3.45 times more volatile than Payden Emerging Markets. It trades about -0.1 of its total potential returns per unit of risk. Payden Emerging Markets is currently generating about 0.06 per unit of volatility. If you would invest 879.00 in Payden Emerging Markets on September 1, 2024 and sell it today you would earn a total of 2.00 from holding Payden Emerging Markets or generate 0.23% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 95.45% |
| Values | Daily Returns |
Siit Emerging Markets vs. Payden Emerging Markets
Performance |
| Timeline |
| Siit Emerging Markets |
| Payden Emerging Markets |
Siit Emerging and Payden Emerging Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Siit Emerging and Payden Emerging
The main advantage of trading using opposite Siit Emerging and Payden Emerging positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Siit Emerging position performs unexpectedly, Payden 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 Payden Emerging will offset losses from the drop in Payden Emerging's long position.| Siit Emerging vs. Saat Market Growth | Siit Emerging vs. Simt Real Return | Siit Emerging vs. Simt Small Cap | Siit Emerging vs. Siit Screened World |
| Payden Emerging vs. Investec Emerging Markets | Payden Emerging vs. Siit Emerging Markets | Payden Emerging vs. Rbc Emerging Markets | Payden Emerging vs. Transamerica Emerging Markets |
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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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