Correlation Between Stet Short and Simt Multi
Can any of the company-specific risk be diversified away by investing in both Stet Short and Simt Multi 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 Stet Short and Simt Multi into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Stet Short Duration and Simt Multi Asset Income, you can compare the effects of market volatilities on Stet Short and Simt Multi 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 Stet Short with a short position of Simt Multi. Check out your portfolio center. Please also check ongoing floating volatility patterns of Stet Short and Simt Multi.
Diversification Opportunities for Stet Short and Simt Multi
0.69 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Stet and Simt is 0.69. Overlapping area represents the amount of risk that can be diversified away by holding Stet Short Duration and Simt Multi Asset Income in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Simt Multi Asset and Stet Short 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 Stet Short Duration are associated (or correlated) with Simt Multi. 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 Stet Short i.e., Stet Short and Simt Multi go up and down completely randomly.
Pair Corralation between Stet Short and Simt Multi
Assuming the 90 days horizon Stet Short is expected to generate 2.53 times less return on investment than Simt Multi. But when comparing it to its historical volatility, Stet Short Duration is 2.03 times less risky than Simt Multi. It trades about 0.33 of its potential returns per unit of risk. Simt Multi Asset Income is currently generating about 0.41 of returns per unit of risk over similar time horizon. If you would invest 996.00 in Simt Multi Asset Income on May 27, 2025 and sell it today you would earn a total of 36.00 from holding Simt Multi Asset Income or generate 3.61% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Stet Short Duration vs. Simt Multi Asset Income
Performance |
| Timeline |
| Stet Short Duration |
| Simt Multi Asset |
Stet Short and Simt Multi Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Stet Short and Simt Multi
The main advantage of trading using opposite Stet Short and Simt Multi positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Stet Short position performs unexpectedly, Simt Multi 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 will offset losses from the drop in Simt Multi's long position.| Stet Short vs. Scout Small Cap | Stet Short vs. Touchstone Small Cap | Stet Short vs. Western Asset Diversified | Stet Short vs. Artisan Small Cap |
| Simt Multi vs. Simt E Fixed | Simt Multi vs. Sit Emerging Markets | Simt Multi vs. Simt Global Managed | Simt Multi vs. Sit International Equity |
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 Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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