Correlation Between Simt Small and Siit Multi
Can any of the company-specific risk be diversified away by investing in both Simt Small and Siit Multi 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 Small and Siit Multi into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Simt Small Cap and Siit Multi Asset Real, you can compare the effects of market volatilities on Simt Small and Siit Multi 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 Small with a short position of Siit Multi. Check out your portfolio center. Please also check ongoing floating volatility patterns of Simt Small and Siit Multi.
Diversification Opportunities for Simt Small and Siit Multi
-0.38 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Simt and Siit is -0.38. Overlapping area represents the amount of risk that can be diversified away by holding Simt Small Cap and Siit Multi Asset Real in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Siit Multi Asset and Simt Small 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 Small Cap are associated (or correlated) with Siit Multi. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Siit Multi Asset has no effect on the direction of Simt Small i.e., Simt Small and Siit Multi go up and down completely randomly.
Pair Corralation between Simt Small and Siit Multi
Assuming the 90 days horizon Simt Small Cap is expected to generate 4.51 times more return on investment than Siit Multi. However, Simt Small is 4.51 times more volatile than Siit Multi Asset Real. It trades about 0.07 of its potential returns per unit of risk. Siit Multi Asset Real is currently generating about 0.03 per unit of risk. If you would invest 2,834 in Simt Small Cap on September 14, 2024 and sell it today you would earn a total of 1,196 from holding Simt Small Cap or generate 42.2% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.8% |
| Values | Daily Returns |
Simt Small Cap vs. Siit Multi Asset Real
Performance |
| Timeline |
| Simt Small Cap |
| Siit Multi Asset |
Simt Small and Siit Multi Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Simt Small and Siit Multi
The main advantage of trading using opposite Simt Small and Siit Multi positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Simt Small position performs unexpectedly, Siit Multi 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 Multi will offset losses from the drop in Siit Multi's long position.| Simt Small vs. Ridgeworth Seix Government | Simt Small vs. Prudential Government Income | Simt Small vs. Short Term Government Fund | Simt Small vs. Dunham Porategovernment Bond |
| Siit Multi vs. Simt Multi Asset Accumulation | Siit Multi vs. Saat Market Growth | Siit Multi vs. Simt Real Return | Siit Multi vs. Simt Small Cap |
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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
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