Correlation Between Federated Government and Simt Multi-asset
Can any of the company-specific risk be diversified away by investing in both Federated Government and Simt Multi-asset 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 Federated Government and Simt Multi-asset into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Federated Government Income and Simt Multi Asset Inflation, you can compare the effects of market volatilities on Federated Government and Simt Multi-asset 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 Federated Government with a short position of Simt Multi-asset. Check out your portfolio center. Please also check ongoing floating volatility patterns of Federated Government and Simt Multi-asset.
Diversification Opportunities for Federated Government and Simt Multi-asset
0.43 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Federated and Simt is 0.43. Overlapping area represents the amount of risk that can be diversified away by holding Federated Government Income and Simt Multi Asset Inflation in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Simt Multi Asset and Federated Government 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 Federated Government Income are associated (or correlated) with Simt Multi-asset. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Simt Multi Asset has no effect on the direction of Federated Government i.e., Federated Government and Simt Multi-asset go up and down completely randomly.
Pair Corralation between Federated Government and Simt Multi-asset
Assuming the 90 days horizon Federated Government Income is expected to generate 1.27 times more return on investment than Simt Multi-asset. However, Federated Government is 1.27 times more volatile than Simt Multi Asset Inflation. It trades about 0.2 of its potential returns per unit of risk. Simt Multi Asset Inflation is currently generating about 0.12 per unit of risk. If you would invest 872.00 in Federated Government Income on June 8, 2025 and sell it today you would earn a total of 33.00 from holding Federated Government Income or generate 3.78% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Federated Government Income vs. Simt Multi Asset Inflation
Performance |
| Timeline |
| Federated Government |
| Simt Multi Asset |
Federated Government and Simt Multi-asset Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Federated Government and Simt Multi-asset
The main advantage of trading using opposite Federated Government and Simt Multi-asset positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Federated Government position performs unexpectedly, Simt Multi-asset 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 Simt Multi-asset will offset losses from the drop in Simt Multi-asset's long position.| Federated Government vs. Federated Emerging Market | Federated Government vs. Federated Mdt All | Federated Government vs. Federated Mdt Balanced | Federated Government vs. Federated Global Allocation |
| Simt Multi-asset vs. Qs Large Cap | Simt Multi-asset vs. Buffalo Large Cap | Simt Multi-asset vs. Siit Large Cap | Simt Multi-asset vs. Qs Large Cap |
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 Center module to all portfolio management and optimization tools to improve performance of your portfolios.
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