Correlation Between Simt Tax-managed and Federated Emerging
Can any of the company-specific risk be diversified away by investing in both Simt Tax-managed and Federated 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 Simt Tax-managed and Federated Emerging into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Simt Tax Managed Large and Federated Emerging Market, you can compare the effects of market volatilities on Simt Tax-managed and Federated 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 Simt Tax-managed with a short position of Federated Emerging. Check out your portfolio center. Please also check ongoing floating volatility patterns of Simt Tax-managed and Federated Emerging.
Diversification Opportunities for Simt Tax-managed and Federated Emerging
0.96 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Simt and Federated is 0.96. Overlapping area represents the amount of risk that can be diversified away by holding Simt Tax Managed Large and Federated Emerging Market in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Federated Emerging Market and Simt Tax-managed 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 Simt Tax Managed Large are associated (or correlated) with Federated Emerging. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Federated Emerging Market has no effect on the direction of Simt Tax-managed i.e., Simt Tax-managed and Federated Emerging go up and down completely randomly.
Pair Corralation between Simt Tax-managed and Federated Emerging
Assuming the 90 days horizon Simt Tax Managed Large is expected to generate 2.66 times more return on investment than Federated Emerging. However, Simt Tax-managed is 2.66 times more volatile than Federated Emerging Market. It trades about 0.14 of its potential returns per unit of risk. Federated Emerging Market is currently generating about 0.34 per unit of risk. If you would invest 3,797 in Simt Tax Managed Large on July 20, 2025 and sell it today you would earn a total of 195.00 from holding Simt Tax Managed Large or generate 5.14% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Simt Tax Managed Large vs. Federated Emerging Market
Performance |
| Timeline |
| Simt Tax Managed |
| Federated Emerging Market |
Simt Tax-managed and Federated Emerging Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Simt Tax-managed and Federated Emerging
The main advantage of trading using opposite Simt Tax-managed and Federated Emerging positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Simt Tax-managed position performs unexpectedly, Federated 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 Federated Emerging will offset losses from the drop in Federated Emerging's long position.| Simt Tax-managed vs. Simt Tax Managed Large | Simt Tax-managed vs. Blackrock Advantage Small | Simt Tax-managed vs. Blackrock Total Stock | Simt Tax-managed vs. Blackrock Advantage Small |
| Federated Emerging vs. Shelton Emerging Markets | Federated Emerging vs. Angel Oak Multi Strategy | Federated Emerging vs. Western Assets Emerging | Federated Emerging vs. Franklin Emerging Market |
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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
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