Correlation Between Pinnacle Sherman and Csjxx

Can any of the company-specific risk be diversified away by investing in both Pinnacle Sherman and Csjxx 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 Pinnacle Sherman and Csjxx into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Pinnacle Sherman Multi Strategy and Csjxx, you can compare the effects of market volatilities on Pinnacle Sherman and Csjxx 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 Pinnacle Sherman with a short position of Csjxx. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pinnacle Sherman and Csjxx.

Diversification Opportunities for Pinnacle Sherman and Csjxx

-0.76

Correlation Coefficient

Pinnacle Sherman  Csjxx

Pay attention - limited upside

The 3 months correlation between Pinnacle and Csjxx is -0.76. Overlapping area represents the amount of risk that can be diversified away by holding Pinnacle Sherman Multi Strateg and Csjxx in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Csjxx and Pinnacle Sherman 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 Pinnacle Sherman Multi Strategy are associated (or correlated) with Csjxx. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Csjxx has no effect on the direction of Pinnacle Sherman i.e., Pinnacle Sherman and Csjxx go up and down completely randomly.

Pair Corralation between Pinnacle Sherman and Csjxx

Assuming the 90 days horizon Pinnacle Sherman Multi Strategy is expected to under-perform the Csjxx. But the mutual fund apears to be less risky and, when comparing its historical volatility, Pinnacle Sherman Multi Strategy is 44.02 times less risky than Csjxx. The mutual fund trades about -0.02 of its potential returns per unit of risk. The Csjxx is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest  494.00  in Csjxx on September 29, 2024 and sell it today you would lose (394.00) from holding Csjxx or give up 79.76% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	98.44%
Values	Daily Returns

Pinnacle Sherman Multi Strateg  vs.  Csjxx

Pinnacle Sherman Multi

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Pinnacle Sherman Multi Strategy has generated negative risk-adjusted returns adding no value to fund investors. In spite of fairly strong technical indicators, Pinnacle Sherman is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Csjxx

Risk-Adjusted Performance

5 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Csjxx are ranked lower than 5 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak basic indicators, Csjxx showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Pinnacle Sherman and Csjxx

The main advantage of trading using opposite Pinnacle Sherman and Csjxx positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Pinnacle Sherman position performs unexpectedly, Csjxx 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 Csjxx will offset losses from the drop in Csjxx's long position.

The idea behind Pinnacle Sherman Multi Strategy and Csjxx pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.