Correlation Between Saat Market and Locorr Market
Can any of the company-specific risk be diversified away by investing in both Saat Market and Locorr Market 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 Saat Market and Locorr Market into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Saat Market Growth and Locorr Market Trend, you can compare the effects of market volatilities on Saat Market and Locorr Market 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 Saat Market with a short position of Locorr Market. Check out your portfolio center. Please also check ongoing floating volatility patterns of Saat Market and Locorr Market.
Diversification Opportunities for Saat Market and Locorr Market
-0.35 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Saat and Locorr is -0.35. Overlapping area represents the amount of risk that can be diversified away by holding Saat Market Growth and Locorr Market Trend in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Locorr Market Trend and Saat Market 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 Saat Market Growth are associated (or correlated) with Locorr Market. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Locorr Market Trend has no effect on the direction of Saat Market i.e., Saat Market and Locorr Market go up and down completely randomly.
Pair Corralation between Saat Market and Locorr Market
Assuming the 90 days horizon Saat Market Growth is expected to generate 0.81 times more return on investment than Locorr Market. However, Saat Market Growth is 1.24 times less risky than Locorr Market. It trades about 0.16 of its potential returns per unit of risk. Locorr Market Trend is currently generating about -0.01 per unit of risk. If you would invest 1,236 in Saat Market Growth on November 6, 2024 and sell it today you would earn a total of 20.00 from holding Saat Market Growth or generate 1.62% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Saat Market Growth vs. Locorr Market Trend
Performance |
| Timeline |
| Saat Market Growth |
| Locorr Market Trend |
Saat Market and Locorr Market Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Saat Market and Locorr Market
The main advantage of trading using opposite Saat Market and Locorr Market positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Saat Market position performs unexpectedly, Locorr Market 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 Locorr Market will offset losses from the drop in Locorr Market's long position.| Saat Market vs. Transamerica International Equity | Saat Market vs. Dreyfusstandish Global Fixed | Saat Market vs. Calvert International Equity | Saat Market vs. Locorr Dynamic Equity |
| Locorr Market vs. Transamerica Emerging Markets | Locorr Market vs. Investec Emerging Markets | Locorr Market vs. Siit Emerging Markets | Locorr Market vs. Barings 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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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