Correlation Between Sit Balanced and Sit Small
Can any of the company-specific risk be diversified away by investing in both Sit Balanced and Sit Small 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 Sit Balanced and Sit Small into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sit Balanced Fund and Sit Small Cap, you can compare the effects of market volatilities on Sit Balanced and Sit Small 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 Sit Balanced with a short position of Sit Small. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sit Balanced and Sit Small.
Diversification Opportunities for Sit Balanced and Sit Small
0.76 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Sit and Sit is 0.76. Overlapping area represents the amount of risk that can be diversified away by holding Sit Balanced Fund and Sit Small Cap in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sit Small Cap and Sit Balanced 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 Sit Balanced Fund are associated (or correlated) with Sit Small. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sit Small Cap has no effect on the direction of Sit Balanced i.e., Sit Balanced and Sit Small go up and down completely randomly.
Pair Corralation between Sit Balanced and Sit Small
Assuming the 90 days horizon Sit Balanced Fund is expected to generate 0.54 times more return on investment than Sit Small. However, Sit Balanced Fund is 1.84 times less risky than Sit Small. It trades about 0.13 of its potential returns per unit of risk. Sit Small Cap is currently generating about 0.01 per unit of risk. If you would invest 3,769 in Sit Balanced Fund on August 17, 2025 and sell it today you would earn a total of 170.00 from holding Sit Balanced Fund or generate 4.51% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 98.46% |
| Values | Daily Returns |
Sit Balanced Fund vs. Sit Small Cap
Performance |
| Timeline |
| Sit Balanced |
| Sit Small Cap |
Sit Balanced and Sit Small Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sit Balanced and Sit Small
The main advantage of trading using opposite Sit Balanced and Sit Small positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sit Balanced position performs unexpectedly, Sit Small 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 Sit Small will offset losses from the drop in Sit Small's long position.| Sit Balanced vs. Principal Lifetime Hybrid | Sit Balanced vs. Baron Fintech | Sit Balanced vs. Rational Defensive Growth | Sit Balanced vs. Clough Global Allocation |
| Sit Small vs. T Rowe Price | Sit Small vs. Bbh Intermediate Municipal | Sit Small vs. Rbc Emerging Markets | Sit Small vs. T Rowe Price |
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 Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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