Correlation Between Sa Emerging and Emerging Markets
Can any of the company-specific risk be diversified away by investing in both Sa Emerging and Emerging Markets 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 Sa Emerging and Emerging Markets into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sa Emerging Markets and Emerging Markets Targeted, you can compare the effects of market volatilities on Sa Emerging and Emerging Markets 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 Sa Emerging with a short position of Emerging Markets. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sa Emerging and Emerging Markets.
Diversification Opportunities for Sa Emerging and Emerging Markets
0.99 | Correlation Coefficient |
No risk reduction
The 3 months correlation between SAEMX and Emerging is 0.99. Overlapping area represents the amount of risk that can be diversified away by holding Sa Emerging Markets and Emerging Markets Targeted in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Emerging Markets Targeted and Sa Emerging 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 Sa Emerging Markets are associated (or correlated) with Emerging Markets. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Emerging Markets Targeted has no effect on the direction of Sa Emerging i.e., Sa Emerging and Emerging Markets go up and down completely randomly.
Pair Corralation between Sa Emerging and Emerging Markets
Assuming the 90 days horizon Sa Emerging is expected to generate 34.6 times less return on investment than Emerging Markets. But when comparing it to its historical volatility, Sa Emerging Markets is 1.03 times less risky than Emerging Markets. It trades about 0.0 of its potential returns per unit of risk. Emerging Markets Targeted is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest 1,287 in Emerging Markets Targeted on May 31, 2025 and sell it today you would earn a total of 20.00 from holding Emerging Markets Targeted or generate 1.55% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 95.65% |
| Values | Daily Returns |
Sa Emerging Markets vs. Emerging Markets Targeted
Performance |
| Timeline |
| Sa Emerging Markets |
| Emerging Markets Targeted |
Sa Emerging and Emerging Markets Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sa Emerging and Emerging Markets
The main advantage of trading using opposite Sa Emerging and Emerging Markets positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sa Emerging position performs unexpectedly, Emerging Markets 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 Emerging Markets will offset losses from the drop in Emerging Markets' long position.| Sa Emerging vs. Live Oak Health | Sa Emerging vs. Health Care Ultrasector | Sa Emerging vs. Delaware Healthcare Fund | Sa Emerging vs. Baron Health Care |
| Emerging Markets vs. Smallcap Fund Fka | Emerging Markets vs. Foundry Partners Fundamental | Emerging Markets vs. Hunter Small Cap | Emerging Markets vs. Scout Small 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 Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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