Correlation Between Stepstone and Univest Pennsylvania
Can any of the company-specific risk be diversified away by investing in both Stepstone and Univest Pennsylvania 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 Stepstone and Univest Pennsylvania into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Stepstone Group and Univest Pennsylvania, you can compare the effects of market volatilities on Stepstone and Univest Pennsylvania 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 Stepstone with a short position of Univest Pennsylvania. Check out your portfolio center. Please also check ongoing floating volatility patterns of Stepstone and Univest Pennsylvania.
Diversification Opportunities for Stepstone and Univest Pennsylvania
0.66 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Stepstone and Univest is 0.66. Overlapping area represents the amount of risk that can be diversified away by holding Stepstone Group and Univest Pennsylvania in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Univest Pennsylvania and Stepstone 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 Stepstone Group are associated (or correlated) with Univest Pennsylvania. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Univest Pennsylvania has no effect on the direction of Stepstone i.e., Stepstone and Univest Pennsylvania go up and down completely randomly.
Pair Corralation between Stepstone and Univest Pennsylvania
Given the investment horizon of 90 days Stepstone Group is expected to generate 1.1 times more return on investment than Univest Pennsylvania. However, Stepstone is 1.1 times more volatile than Univest Pennsylvania. It trades about 0.11 of its potential returns per unit of risk. Univest Pennsylvania is currently generating about 0.09 per unit of risk. If you would invest 3,561 in Stepstone Group on November 5, 2024 and sell it today you would earn a total of 2,744 from holding Stepstone Group or generate 77.06% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Stepstone Group vs. Univest Pennsylvania
Performance |
| Timeline |
| Stepstone Group |
| Univest Pennsylvania |
Stepstone and Univest Pennsylvania Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Stepstone and Univest Pennsylvania
The main advantage of trading using opposite Stepstone and Univest Pennsylvania positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Stepstone position performs unexpectedly, Univest Pennsylvania 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 Univest Pennsylvania will offset losses from the drop in Univest Pennsylvania's long position.| Stepstone vs. Munivest Fund | Stepstone vs. Blackrock Muniyield Quality | Stepstone vs. Federated Investors B | Stepstone vs. Federated Premier Municipal |
| Univest Pennsylvania vs. Waterstone Financial | Univest Pennsylvania vs. Mid Penn Bancorp | Univest Pennsylvania vs. ST Bancorp | Univest Pennsylvania vs. Republic Bancorp |
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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
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