Correlation Between Nasdaq-100 Index and Siit Emerging
Can any of the company-specific risk be diversified away by investing in both Nasdaq-100 Index and Siit 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 Nasdaq-100 Index and Siit Emerging into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Nasdaq 100 Index Fund and Siit Emerging Markets, you can compare the effects of market volatilities on Nasdaq-100 Index and Siit 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 Nasdaq-100 Index with a short position of Siit Emerging. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nasdaq-100 Index and Siit Emerging.
Diversification Opportunities for Nasdaq-100 Index and Siit Emerging
-0.33 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Nasdaq-100 and Siit is -0.33. Overlapping area represents the amount of risk that can be diversified away by holding Nasdaq 100 Index Fund and Siit Emerging Markets in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Siit Emerging Markets and Nasdaq-100 Index 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 Nasdaq 100 Index Fund are associated (or correlated) with Siit Emerging. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Siit Emerging Markets has no effect on the direction of Nasdaq-100 Index i.e., Nasdaq-100 Index and Siit Emerging go up and down completely randomly.
Pair Corralation between Nasdaq-100 Index and Siit Emerging
Assuming the 90 days horizon Nasdaq 100 Index Fund is expected to generate 1.44 times more return on investment than Siit Emerging. However, Nasdaq-100 Index is 1.44 times more volatile than Siit Emerging Markets. It trades about 0.1 of its potential returns per unit of risk. Siit Emerging Markets is currently generating about 0.03 per unit of risk. If you would invest 2,999 in Nasdaq 100 Index Fund on October 13, 2024 and sell it today you would earn a total of 2,214 from holding Nasdaq 100 Index Fund or generate 73.82% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.8% |
| Values | Daily Returns |
Nasdaq 100 Index Fund vs. Siit Emerging Markets
Performance |
| Timeline |
| Nasdaq 100 Index |
| Siit Emerging Markets |
Nasdaq-100 Index and Siit Emerging Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nasdaq-100 Index and Siit Emerging
The main advantage of trading using opposite Nasdaq-100 Index and Siit Emerging positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nasdaq-100 Index position performs unexpectedly, Siit 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 Siit Emerging will offset losses from the drop in Siit Emerging's long position.| Nasdaq-100 Index vs. Hennessy Technology Fund | Nasdaq-100 Index vs. Icon Information Technology | Nasdaq-100 Index vs. Fidelity Advisor Technology | Nasdaq-100 Index vs. Firsthand Technology Opportunities |
| Siit Emerging vs. Aqr Sustainable Long Short | Siit Emerging vs. Alphacentric Hedged Market | Siit Emerging vs. Investec Emerging Markets | Siit Emerging vs. Fidelity New Markets |
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 Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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