Correlation Between Standpoint Multi and Simplify Interest

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

By analyzing existing cross correlation between Standpoint Multi Asset and Simplify Interest Rate, you can compare the effects of market volatilities on Standpoint Multi and Simplify Interest 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 Standpoint Multi with a short position of Simplify Interest. Check out your portfolio center. Please also check ongoing floating volatility patterns of Standpoint Multi and Simplify Interest.

Diversification Opportunities for Standpoint Multi and Simplify Interest

0.31

Correlation Coefficient

Standpoint Multi  Simplify Interest

Weak diversification

The 3 months correlation between Standpoint and Simplify is 0.31. Overlapping area represents the amount of risk that can be diversified away by holding Standpoint Multi Asset and Simplify Interest Rate in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Simplify Interest Rate and Standpoint Multi 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 Standpoint Multi Asset are associated (or correlated) with Simplify Interest. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Simplify Interest Rate has no effect on the direction of Standpoint Multi i.e., Standpoint Multi and Simplify Interest go up and down completely randomly.

Pair Corralation between Standpoint Multi and Simplify Interest

Assuming the 90 days horizon Standpoint Multi Asset is expected to generate 0.29 times more return on investment than Simplify Interest. However, Standpoint Multi Asset is 3.45 times less risky than Simplify Interest. It trades about 0.07 of its potential returns per unit of risk. Simplify Interest Rate is currently generating about -0.04 per unit of risk. If you would invest  1,293  in Standpoint Multi Asset on May 14, 2025 and sell it today you would earn a total of  39.00  from holding Standpoint Multi Asset or generate 3.02% return on investment over 90 days.

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

Standpoint Multi Asset  vs.  Simplify Interest Rate

Standpoint Multi Asset

Risk-Adjusted Performance

Mild

Compared to the overall equity markets, risk-adjusted returns on investments in Standpoint Multi Asset are ranked lower than 5 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong forward indicators, Standpoint Multi is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Simplify Interest Rate

Risk-Adjusted Performance

Weakest

Over the last 90 days Simplify Interest Rate has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest conflicting performance, the Etf's forward indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the ETF investors.

Pair Trading with Standpoint Multi and Simplify Interest

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

The idea behind Standpoint Multi Asset and Simplify Interest Rate 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.