Correlation Between Saat Defensive and Siit World
Can any of the company-specific risk be diversified away by investing in both Saat Defensive and Siit World 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 Defensive and Siit World into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Saat Defensive Strategy and Siit World Select, you can compare the effects of market volatilities on Saat Defensive and Siit World 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 Defensive with a short position of Siit World. Check out your portfolio center. Please also check ongoing floating volatility patterns of Saat Defensive and Siit World.
Diversification Opportunities for Saat Defensive and Siit World
-0.54 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Saat and Siit is -0.54. Overlapping area represents the amount of risk that can be diversified away by holding Saat Defensive Strategy and Siit World Select in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Siit World Select and Saat Defensive 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 Defensive Strategy are associated (or correlated) with Siit World. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Siit World Select has no effect on the direction of Saat Defensive i.e., Saat Defensive and Siit World go up and down completely randomly.
Pair Corralation between Saat Defensive and Siit World
Assuming the 90 days horizon Saat Defensive is expected to generate 7.67 times less return on investment than Siit World. But when comparing it to its historical volatility, Saat Defensive Strategy is 12.93 times less risky than Siit World. It trades about 0.38 of its potential returns per unit of risk. Siit World Select is currently generating about 0.23 of returns per unit of risk over similar time horizon. If you would invest 1,158 in Siit World Select on October 20, 2024 and sell it today you would earn a total of 32.00 from holding Siit World Select or generate 2.76% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Saat Defensive Strategy vs. Siit World Select
Performance |
| Timeline |
| Saat Defensive Strategy |
| Siit World Select |
Saat Defensive and Siit World Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Saat Defensive and Siit World
The main advantage of trading using opposite Saat Defensive and Siit World positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Saat Defensive position performs unexpectedly, Siit World 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 World will offset losses from the drop in Siit World's long position.| Saat Defensive vs. Simt Multi Asset Accumulation | Saat Defensive vs. Saat Market Growth | Saat Defensive vs. Simt Real Return | Saat Defensive vs. Simt Small Cap |
| Siit World vs. Simt Multi Asset Accumulation | Siit World vs. Saat Market Growth | Siit World vs. Simt Real Return | Siit World 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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
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