Correlation Between Simt Small and Siit Managed
Can any of the company-specific risk be diversified away by investing in both Simt Small and Siit Managed 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 Managed 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 Managed Volatility, you can compare the effects of market volatilities on Simt Small and Siit Managed 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 Managed. Check out your portfolio center. Please also check ongoing floating volatility patterns of Simt Small and Siit Managed.
Diversification Opportunities for Simt Small and Siit Managed
0.98 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Simt and Siit is 0.98. Overlapping area represents the amount of risk that can be diversified away by holding Simt Small Cap and Siit Managed Volatility in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Siit Managed Volatility 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 Managed. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Siit Managed Volatility has no effect on the direction of Simt Small i.e., Simt Small and Siit Managed go up and down completely randomly.
Pair Corralation between Simt Small and Siit Managed
Assuming the 90 days horizon Simt Small Cap is expected to under-perform the Siit Managed. In addition to that, Simt Small is 2.03 times more volatile than Siit Managed Volatility. It trades about -0.1 of its total potential returns per unit of risk. Siit Managed Volatility is currently generating about -0.11 per unit of volatility. If you would invest 1,296 in Siit Managed Volatility on September 12, 2024 and sell it today you would lose (17.00) from holding Siit Managed Volatility or give up 1.31% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 95.45% |
| Values | Daily Returns |
Simt Small Cap vs. Siit Managed Volatility
Performance |
| Timeline |
| Simt Small Cap |
| Siit Managed Volatility |
Simt Small and Siit Managed Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Simt Small and Siit Managed
The main advantage of trading using opposite Simt Small and Siit Managed positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Simt Small position performs unexpectedly, Siit Managed 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 Managed will offset losses from the drop in Siit Managed's long position.| Simt Small vs. Sprott Gold Equity | Simt Small vs. Franklin Gold Precious | Simt Small vs. Great West Goldman Sachs | Simt Small vs. Global Gold Fund |
| Siit Managed vs. Vanguard Value Index | Siit Managed vs. Dodge Cox Stock | Siit Managed vs. American Mutual Fund | Siit Managed vs. American Funds American |
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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
Other Complementary Tools
| Global Correlations Find global opportunities by holding instruments from different markets | |
| Technical Analysis Check basic technical indicators and analysis based on most latest market data | |
| Latest Portfolios Quick portfolio dashboard that showcases your latest portfolios | |
| Portfolio Anywhere Track or share privately all of your investments from the convenience of any device | |
| Idea Breakdown Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes |