Correlation Between Sit Small and Plumb Balanced
Can any of the company-specific risk be diversified away by investing in both Sit Small and Plumb Balanced 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 Sit Small and Plumb Balanced into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sit Small Cap and Plumb Balanced Fund, you can compare the effects of market volatilities on Sit Small and Plumb Balanced 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 Sit Small with a short position of Plumb Balanced. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sit Small and Plumb Balanced.
Diversification Opportunities for Sit Small and Plumb Balanced
0.68 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Sit and Plumb is 0.68. Overlapping area represents the amount of risk that can be diversified away by holding Sit Small Cap and Plumb Balanced Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Plumb Balanced and Sit 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 Sit Small Cap are associated (or correlated) with Plumb Balanced. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Plumb Balanced has no effect on the direction of Sit Small i.e., Sit Small and Plumb Balanced go up and down completely randomly.
Pair Corralation between Sit Small and Plumb Balanced
Assuming the 90 days horizon Sit Small Cap is expected to under-perform the Plumb Balanced. In addition to that, Sit Small is 1.91 times more volatile than Plumb Balanced Fund. It trades about -0.33 of its total potential returns per unit of risk. Plumb Balanced Fund is currently generating about -0.06 per unit of volatility. If you would invest 3,702 in Plumb Balanced Fund on November 28, 2024 and sell it today you would lose (27.00) from holding Plumb Balanced Fund or give up 0.73% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sit Small Cap vs. Plumb Balanced Fund
Performance |
| Timeline |
| Sit Small Cap |
| Plumb Balanced |
Sit Small and Plumb Balanced Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sit Small and Plumb Balanced
The main advantage of trading using opposite Sit Small and Plumb Balanced positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sit Small position performs unexpectedly, Plumb Balanced 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 Plumb Balanced will offset losses from the drop in Plumb Balanced's long position.| Sit Small vs. Alpine Ultra Short | Sit Small vs. Siit Ultra Short | Sit Small vs. Fidelity Flex Servative | Sit Small vs. Delaware Investments Ultrashort |
| Plumb Balanced vs. Plumb Equity Fund | Plumb Balanced vs. Value Line Asset | Plumb Balanced vs. Sit Balanced Fund | Plumb Balanced vs. Performance Trust Strategic |
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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
Other Complementary Tools
| Headlines Timeline Stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity | |
| Earnings Calls Check upcoming earnings announcements updated hourly across public exchanges | |
| Piotroski F Score Get Piotroski F Score based on the binary analysis strategy of nine different fundamentals | |
| Equity Valuation Check real value of public entities based on technical and fundamental data | |
| My Watchlist Analysis Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like |