Correlation Between Simt Small and Siit Long
Can any of the company-specific risk be diversified away by investing in both Simt Small and Siit Long 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 Long 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 Long Duration, you can compare the effects of market volatilities on Simt Small and Siit Long 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 Long. Check out your portfolio center. Please also check ongoing floating volatility patterns of Simt Small and Siit Long.
Diversification Opportunities for Simt Small and Siit Long
-0.61 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Simt and Siit is -0.61. Overlapping area represents the amount of risk that can be diversified away by holding Simt Small Cap and Siit Long Duration in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Siit Long Duration 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 Long. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Siit Long Duration has no effect on the direction of Simt Small i.e., Simt Small and Siit Long go up and down completely randomly.
Pair Corralation between Simt Small and Siit Long
Assuming the 90 days horizon Simt Small Cap is expected to generate 1.52 times more return on investment than Siit Long. However, Simt Small is 1.52 times more volatile than Siit Long Duration. It trades about 0.07 of its potential returns per unit of risk. Siit Long Duration is currently generating about 0.01 per unit of risk. If you would invest 2,871 in Simt Small Cap on September 5, 2024 and sell it today you would earn a total of 1,249 from holding Simt Small Cap or generate 43.5% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Simt Small Cap vs. Siit Long Duration
Performance |
| Timeline |
| Simt Small Cap |
| Siit Long Duration |
Simt Small and Siit Long Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Simt Small and Siit Long
The main advantage of trading using opposite Simt Small and Siit Long positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Simt Small position performs unexpectedly, Siit Long 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 Long will offset losses from the drop in Siit Long's long position.| Simt Small vs. Jp Morgan Smartretirement | Simt Small vs. Legg Mason Partners | Simt Small vs. Hood River New | Simt Small vs. T Rowe Price |
| Siit Long vs. Simt Multi Asset Accumulation | Siit Long vs. Saat Market Growth | Siit Long vs. Simt Real Return | Siit Long 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 Portfolio Dashboard module to portfolio dashboard that provides centralized access to all your investments.
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