Correlation Between Simt Global and Sit Emerging
Can any of the company-specific risk be diversified away by investing in both Simt Global and Sit Emerging 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 Global and Sit Emerging into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Simt Global Managed and Sit Emerging Markets, you can compare the effects of market volatilities on Simt Global and Sit Emerging 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 Global with a short position of Sit Emerging. Check out your portfolio center. Please also check ongoing floating volatility patterns of Simt Global and Sit Emerging.
Diversification Opportunities for Simt Global and Sit Emerging
0.19 | Correlation Coefficient |
Average diversification
The 3 months correlation between Simt and Sit is 0.19. Overlapping area represents the amount of risk that can be diversified away by holding Simt Global Managed and Sit Emerging Markets in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sit Emerging Markets and Simt Global 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 Global Managed are associated (or correlated) with Sit Emerging. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sit Emerging Markets has no effect on the direction of Simt Global i.e., Simt Global and Sit Emerging go up and down completely randomly.
Pair Corralation between Simt Global and Sit Emerging
Assuming the 90 days horizon Simt Global is expected to generate 1.24 times less return on investment than Sit Emerging. In addition to that, Simt Global is 1.35 times more volatile than Sit Emerging Markets. It trades about 0.05 of its total potential returns per unit of risk. Sit Emerging Markets is currently generating about 0.08 per unit of volatility. If you would invest 738.00 in Sit Emerging Markets on August 30, 2024 and sell it today you would earn a total of 136.00 from holding Sit Emerging Markets or generate 18.43% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Simt Global Managed vs. Sit Emerging Markets
Performance |
| Timeline |
| Simt Global Managed |
| Sit Emerging Markets |
Simt Global and Sit Emerging Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Simt Global and Sit Emerging
The main advantage of trading using opposite Simt Global and Sit Emerging positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Simt Global position performs unexpectedly, Sit Emerging 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 Sit Emerging will offset losses from the drop in Sit Emerging's long position.| Simt Global vs. Angel Oak Financial | Simt Global vs. Touchstone Ohio Tax | Simt Global vs. Dws Government Money | Simt Global vs. Prudential Jennison Financial |
| Sit Emerging vs. T Rowe Price | Sit Emerging vs. Multisector Bond Sma | Sit Emerging vs. Blrc Sgy Mnp | Sit Emerging vs. Sterling Capital Short |
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 Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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