Correlation Between Intermediate Term and Saat Aggressive
Can any of the company-specific risk be diversified away by investing in both Intermediate Term and Saat Aggressive 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 Intermediate Term and Saat Aggressive into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Intermediate Term Bond Fund and Saat Aggressive Strategy, you can compare the effects of market volatilities on Intermediate Term and Saat Aggressive 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 Intermediate Term with a short position of Saat Aggressive. Check out your portfolio center. Please also check ongoing floating volatility patterns of Intermediate Term and Saat Aggressive.
Diversification Opportunities for Intermediate Term and Saat Aggressive
0.73 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Intermediate and Saat is 0.73. Overlapping area represents the amount of risk that can be diversified away by holding Intermediate Term Bond Fund and Saat Aggressive Strategy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Saat Aggressive Strategy and Intermediate Term 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 Intermediate Term Bond Fund are associated (or correlated) with Saat Aggressive. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Saat Aggressive Strategy has no effect on the direction of Intermediate Term i.e., Intermediate Term and Saat Aggressive go up and down completely randomly.
Pair Corralation between Intermediate Term and Saat Aggressive
Assuming the 90 days horizon Intermediate Term is expected to generate 2.61 times less return on investment than Saat Aggressive. But when comparing it to its historical volatility, Intermediate Term Bond Fund is 1.58 times less risky than Saat Aggressive. It trades about 0.04 of its potential returns per unit of risk. Saat Aggressive Strategy is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 1,194 in Saat Aggressive Strategy on November 1, 2024 and sell it today you would earn a total of 264.00 from holding Saat Aggressive Strategy or generate 22.11% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Intermediate Term Bond Fund vs. Saat Aggressive Strategy
Performance |
| Timeline |
| Intermediate Term Bond |
| Saat Aggressive Strategy |
Intermediate Term and Saat Aggressive Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Intermediate Term and Saat Aggressive
The main advantage of trading using opposite Intermediate Term and Saat Aggressive positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Intermediate Term position performs unexpectedly, Saat Aggressive 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 Saat Aggressive will offset losses from the drop in Saat Aggressive's long position.| Intermediate Term vs. Precious Metals And | Intermediate Term vs. Global Gold Fund | Intermediate Term vs. Gabelli Gold Fund | Intermediate Term vs. Deutsche Gold Precious |
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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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
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