Correlation Between American Beacon and Siit Global
Can any of the company-specific risk be diversified away by investing in both American Beacon and Siit Global 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 American Beacon and Siit Global into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between American Beacon Stephens and Siit Global Managed, you can compare the effects of market volatilities on American Beacon and Siit Global 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 American Beacon with a short position of Siit Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of American Beacon and Siit Global.
Diversification Opportunities for American Beacon and Siit Global
0.94 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between American and Siit is 0.94. Overlapping area represents the amount of risk that can be diversified away by holding American Beacon Stephens and Siit Global Managed in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Siit Global Managed and American Beacon 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 American Beacon Stephens are associated (or correlated) with Siit Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Siit Global Managed has no effect on the direction of American Beacon i.e., American Beacon and Siit Global go up and down completely randomly.
Pair Corralation between American Beacon and Siit Global
Assuming the 90 days horizon American Beacon Stephens is expected to generate 2.4 times more return on investment than Siit Global. However, American Beacon is 2.4 times more volatile than Siit Global Managed. It trades about 0.08 of its potential returns per unit of risk. Siit Global Managed is currently generating about 0.17 per unit of risk. If you would invest 1,101 in American Beacon Stephens on September 12, 2024 and sell it today you would earn a total of 234.00 from holding American Beacon Stephens or generate 21.25% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
American Beacon Stephens vs. Siit Global Managed
Performance |
| Timeline |
| American Beacon Stephens |
| Siit Global Managed |
American Beacon and Siit Global Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with American Beacon and Siit Global
The main advantage of trading using opposite American Beacon and Siit Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if American Beacon position performs unexpectedly, Siit Global 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 Siit Global will offset losses from the drop in Siit Global's long position.| American Beacon vs. Siit Global Managed | American Beacon vs. Ab Global Bond | American Beacon vs. Ab Global Real | American Beacon vs. Ab Global Risk |
| Siit Global vs. Qs Growth Fund | Siit Global vs. Ab Value Fund | Siit Global vs. Century Small Cap | Siit Global vs. T Rowe Price |
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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