Correlation Between Simt Tax-managed and Stet Intermediate
Can any of the company-specific risk be diversified away by investing in both Simt Tax-managed and Stet Intermediate 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 Tax-managed and Stet Intermediate into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Simt Tax Managed Smallmid and Stet Intermediate Term, you can compare the effects of market volatilities on Simt Tax-managed and Stet Intermediate 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 Tax-managed with a short position of Stet Intermediate. Check out your portfolio center. Please also check ongoing floating volatility patterns of Simt Tax-managed and Stet Intermediate.
Diversification Opportunities for Simt Tax-managed and Stet Intermediate
-0.41 | Correlation Coefficient |
Very good diversification
The 3 months correlation between SIMT and Stet is -0.41. Overlapping area represents the amount of risk that can be diversified away by holding Simt Tax Managed Smallmid and Stet Intermediate Term in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Stet Intermediate Term and Simt Tax-managed 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 Tax Managed Smallmid are associated (or correlated) with Stet Intermediate. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Stet Intermediate Term has no effect on the direction of Simt Tax-managed i.e., Simt Tax-managed and Stet Intermediate go up and down completely randomly.
Pair Corralation between Simt Tax-managed and Stet Intermediate
Assuming the 90 days horizon Simt Tax Managed Smallmid is expected to generate 6.76 times more return on investment than Stet Intermediate. However, Simt Tax-managed is 6.76 times more volatile than Stet Intermediate Term. It trades about 0.1 of its potential returns per unit of risk. Stet Intermediate Term is currently generating about 0.06 per unit of risk. If you would invest 2,414 in Simt Tax Managed Smallmid on August 28, 2024 and sell it today you would earn a total of 621.00 from holding Simt Tax Managed Smallmid or generate 25.72% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 99.52% |
| Values | Daily Returns |
Simt Tax Managed Smallmid vs. Stet Intermediate Term
Performance |
| Timeline |
| Simt Tax Managed |
| Stet Intermediate Term |
Simt Tax-managed and Stet Intermediate Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Simt Tax-managed and Stet Intermediate
The main advantage of trading using opposite Simt Tax-managed and Stet Intermediate positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Simt Tax-managed position performs unexpectedly, Stet Intermediate 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 Stet Intermediate will offset losses from the drop in Stet Intermediate's long position.| Simt Tax-managed vs. Artisan Small Cap | Simt Tax-managed vs. Champlain Small | Simt Tax-managed vs. Vanguard Small Cap Index | Simt Tax-managed vs. The Hartford Small |
| Stet Intermediate vs. Sit International Equity | Stet Intermediate vs. Intermediate Taxamt Free Fund | Stet Intermediate vs. Goldman Sachs Short | Stet Intermediate vs. Simt High Yield |
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 Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
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