Correlation Between Touchstone Small and Sterling Capital
Can any of the company-specific risk be diversified away by investing in both Touchstone Small and Sterling Capital 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 Touchstone Small and Sterling Capital into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Touchstone Small Cap and Sterling Capital Porate, you can compare the effects of market volatilities on Touchstone Small and Sterling Capital 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 Touchstone Small with a short position of Sterling Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of Touchstone Small and Sterling Capital.
Diversification Opportunities for Touchstone Small and Sterling Capital
-0.58 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Touchstone and Sterling is -0.58. Overlapping area represents the amount of risk that can be diversified away by holding Touchstone Small Cap and Sterling Capital Porate in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sterling Capital Porate and Touchstone Small 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 Touchstone Small Cap are associated (or correlated) with Sterling Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sterling Capital Porate has no effect on the direction of Touchstone Small i.e., Touchstone Small and Sterling Capital go up and down completely randomly.
Pair Corralation between Touchstone Small and Sterling Capital
Assuming the 90 days horizon Touchstone Small Cap is expected to generate 1.44 times more return on investment than Sterling Capital. However, Touchstone Small is 1.44 times more volatile than Sterling Capital Porate. It trades about 0.05 of its potential returns per unit of risk. Sterling Capital Porate is currently generating about 0.02 per unit of risk. If you would invest 3,337 in Touchstone Small Cap on September 3, 2024 and sell it today you would earn a total of 840.00 from holding Touchstone Small Cap or generate 25.17% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Touchstone Small Cap vs. Sterling Capital Porate
Performance |
| Timeline |
| Touchstone Small Cap |
| Sterling Capital Porate |
Touchstone Small and Sterling Capital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Touchstone Small and Sterling Capital
The main advantage of trading using opposite Touchstone Small and Sterling Capital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Touchstone Small position performs unexpectedly, Sterling Capital 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 Sterling Capital will offset losses from the drop in Sterling Capital's long position.| Touchstone Small vs. Vanguard Small Cap Value | Touchstone Small vs. Vanguard Small Cap Value | Touchstone Small vs. Us Small Cap | Touchstone Small vs. Us Targeted Value |
| Sterling Capital vs. Europac Gold Fund | Sterling Capital vs. International Investors Gold | Sterling Capital vs. Fidelity Advisor Gold | Sterling Capital vs. Oppenheimer Gold Special |
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 Global Correlations module to find global opportunities by holding instruments from different markets.
Other Complementary Tools
| Companies Directory Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals | |
| My Watchlist Analysis Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like | |
| Odds Of Bankruptcy Get analysis of equity chance of financial distress in the next 2 years | |
| Analyst Advice Analyst recommendations and target price estimates broken down by several categories | |
| Price Ceiling Movement Calculate and plot Price Ceiling Movement for different equity instruments |