Correlation Between Siit Ultra and Siit Small
Can any of the company-specific risk be diversified away by investing in both Siit Ultra and Siit Small 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 Siit Ultra and Siit Small into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Siit Ultra Short and Siit Small Mid, you can compare the effects of market volatilities on Siit Ultra and Siit Small 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 Siit Ultra with a short position of Siit Small. Check out your portfolio center. Please also check ongoing floating volatility patterns of Siit Ultra and Siit Small.
Diversification Opportunities for Siit Ultra and Siit Small
0.72 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Siit and Siit is 0.72. Overlapping area represents the amount of risk that can be diversified away by holding Siit Ultra Short and Siit Small Mid in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Siit Small Mid and Siit Ultra 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 Siit Ultra Short are associated (or correlated) with Siit Small. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Siit Small Mid has no effect on the direction of Siit Ultra i.e., Siit Ultra and Siit Small go up and down completely randomly.
Pair Corralation between Siit Ultra and Siit Small
Assuming the 90 days horizon Siit Ultra is expected to generate 4.81 times less return on investment than Siit Small. But when comparing it to its historical volatility, Siit Ultra Short is 10.16 times less risky than Siit Small. It trades about 0.22 of its potential returns per unit of risk. Siit Small Mid is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest 911.00 in Siit Small Mid on September 4, 2024 and sell it today you would earn a total of 266.00 from holding Siit Small Mid or generate 29.2% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 99.6% |
| Values | Daily Returns |
Siit Ultra Short vs. Siit Small Mid
Performance |
| Timeline |
| Siit Ultra Short |
| Siit Small Mid |
Siit Ultra and Siit Small Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Siit Ultra and Siit Small
The main advantage of trading using opposite Siit Ultra and Siit Small positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Siit Ultra position performs unexpectedly, Siit Small 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 Small will offset losses from the drop in Siit Small's long position.| Siit Ultra vs. Arrow Managed Futures | Siit Ultra vs. Aqr Managed Futures | Siit Ultra vs. Asg Managed Futures | Siit Ultra vs. Inflation Protected Bond Fund |
| Siit Small vs. Barings Active Short | Siit Small vs. Sterling Capital Short | Siit Small vs. Siit Ultra Short | Siit Small vs. Angel Oak Ultrashort |
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 Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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