Correlation Between Balanced Fund and Sterling Capital
Can any of the company-specific risk be diversified away by investing in both Balanced Fund 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 Balanced Fund and Sterling Capital into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Balanced Fund Retail and Sterling Capital Ultra, you can compare the effects of market volatilities on Balanced Fund 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 Balanced Fund with a short position of Sterling Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of Balanced Fund and Sterling Capital.
Diversification Opportunities for Balanced Fund and Sterling Capital
0.87 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Balanced and Sterling is 0.87. Overlapping area represents the amount of risk that can be diversified away by holding Balanced Fund Retail and Sterling Capital Ultra in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sterling Capital Ultra and Balanced Fund 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 Balanced Fund Retail 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 Ultra has no effect on the direction of Balanced Fund i.e., Balanced Fund and Sterling Capital go up and down completely randomly.
Pair Corralation between Balanced Fund and Sterling Capital
Assuming the 90 days horizon Balanced Fund Retail is expected to generate 5.87 times more return on investment than Sterling Capital. However, Balanced Fund is 5.87 times more volatile than Sterling Capital Ultra. It trades about 0.1 of its potential returns per unit of risk. Sterling Capital Ultra is currently generating about 0.23 per unit of risk. If you would invest 1,326 in Balanced Fund Retail on August 13, 2025 and sell it today you would earn a total of 41.00 from holding Balanced Fund Retail or generate 3.09% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Balanced Fund Retail vs. Sterling Capital Ultra
Performance |
| Timeline |
| Balanced Fund Retail |
| Sterling Capital Ultra |
Balanced Fund and Sterling Capital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Balanced Fund and Sterling Capital
The main advantage of trading using opposite Balanced Fund and Sterling Capital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Balanced Fund 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.| Balanced Fund vs. Dynamic Growth Fund | Balanced Fund vs. Blackrock Conservative Prprdptfinvstra | Balanced Fund vs. Huber Capital Equity | Balanced Fund vs. Harding Loevner Emerging |
| Sterling Capital vs. Diversified Bond Fund | Sterling Capital vs. Semiconductor Ultrasector Profund | Sterling Capital vs. American Century Diversified | Sterling Capital vs. Delaware Limited Term Diversified |
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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
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