Correlation Between Segall Bryant and Pace Small/medium

Can any of the company-specific risk be diversified away by investing in both Segall Bryant and Pace Small/medium 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 Segall Bryant and Pace Small/medium into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Segall Bryant Hamill and Pace Smallmedium Value, you can compare the effects of market volatilities on Segall Bryant and Pace Small/medium 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 Segall Bryant with a short position of Pace Small/medium. Check out your portfolio center. Please also check ongoing floating volatility patterns of Segall Bryant and Pace Small/medium.

Diversification Opportunities for Segall Bryant and Pace Small/medium

-0.43

Correlation Coefficient

Segall Bryant  Pace Small/medium

Very good diversification

The 3 months correlation between Segall and Pace is -0.43. Overlapping area represents the amount of risk that can be diversified away by holding Segall Bryant Hamill and Pace Smallmedium Value in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pace Smallmedium Value and Segall Bryant 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 Segall Bryant Hamill are associated (or correlated) with Pace Small/medium. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pace Smallmedium Value has no effect on the direction of Segall Bryant i.e., Segall Bryant and Pace Small/medium go up and down completely randomly.

Pair Corralation between Segall Bryant and Pace Small/medium

Assuming the 90 days horizon Segall Bryant Hamill is expected to under-perform the Pace Small/medium. But the mutual fund apears to be less risky and, when comparing its historical volatility, Segall Bryant Hamill is 1.26 times less risky than Pace Small/medium. The mutual fund trades about -0.03 of its potential returns per unit of risk. The Pace Smallmedium Value is currently generating about 0.18 of returns per unit of risk over similar time horizon. If you would invest  1,974  in Pace Smallmedium Value on September 1, 2024 and sell it today you would earn a total of  236.00  from holding Pace Smallmedium Value or generate 11.96% return on investment over 90 days.

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

Segall Bryant Hamill  vs.  Pace Smallmedium Value

Segall Bryant Hamill

Risk-Adjusted Performance

0 of 100

Very Weak

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

Pace Smallmedium Value

Risk-Adjusted Performance

13 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Pace Smallmedium Value are ranked lower than 13 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak basic indicators, Pace Small/medium may actually be approaching a critical reversion point that can send shares even higher in December 2024.

Pair Trading with Segall Bryant and Pace Small/medium

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

The idea behind Segall Bryant Hamill and Pace Smallmedium Value 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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.