Correlation Between Pnc International and Elfun Diversified

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

By analyzing existing cross correlation between Pnc International Equity and Elfun Diversified Fund, you can compare the effects of market volatilities on Pnc International and Elfun Diversified 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 Pnc International with a short position of Elfun Diversified. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pnc International and Elfun Diversified.

Diversification Opportunities for Pnc International and Elfun Diversified

0.89

Correlation Coefficient

Pnc International  Elfun Diversified

Very poor diversification

The 3 months correlation between Pnc and Elfun is 0.89. Overlapping area represents the amount of risk that can be diversified away by holding Pnc International Equity and Elfun Diversified Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Elfun Diversified and Pnc International 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 Pnc International Equity are associated (or correlated) with Elfun Diversified. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Elfun Diversified has no effect on the direction of Pnc International i.e., Pnc International and Elfun Diversified go up and down completely randomly.

Pair Corralation between Pnc International and Elfun Diversified

Assuming the 90 days horizon Pnc International is expected to generate 1.23 times less return on investment than Elfun Diversified. In addition to that, Pnc International is 1.46 times more volatile than Elfun Diversified Fund. It trades about 0.1 of its total potential returns per unit of risk. Elfun Diversified Fund is currently generating about 0.17 per unit of volatility. If you would invest  2,244  in Elfun Diversified Fund on August 14, 2025 and sell it today you would earn a total of  107.00  from holding Elfun Diversified Fund or generate 4.77% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Strong
Accuracy	100.0%
Values	Daily Returns

Pnc International Equity  vs.  Elfun Diversified Fund

Pnc International Equity

Risk-Adjusted Performance

Fair

Compared to the overall equity markets, risk-adjusted returns on investments in Pnc International Equity are ranked lower than 7 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong fundamental indicators, Pnc International is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Elfun Diversified

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Elfun Diversified Fund are ranked lower than 13 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong technical and fundamental indicators, Elfun Diversified is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Pnc International and Elfun Diversified

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

The idea behind Pnc International Equity and Elfun Diversified Fund 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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.