Correlation Between Rbc Emerging and Small Cap

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

By analyzing existing cross correlation between Rbc Emerging Markets and Small Cap Index, you can compare the effects of market volatilities on Rbc Emerging and Small Cap 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 Rbc Emerging with a short position of Small Cap. Check out your portfolio center. Please also check ongoing floating volatility patterns of Rbc Emerging and Small Cap.

Diversification Opportunities for Rbc Emerging and Small Cap

0.0

Correlation Coefficient

Rbc Emerging  Small Cap

Pay attention - limited upside

The 3 months correlation between Rbc and Small is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Rbc Emerging Markets and Small Cap Index in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Small Cap Index and Rbc Emerging 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 Rbc Emerging Markets are associated (or correlated) with Small Cap. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Small Cap Index has no effect on the direction of Rbc Emerging i.e., Rbc Emerging and Small Cap go up and down completely randomly.

Pair Corralation between Rbc Emerging and Small Cap

If you would invest  1,016  in Rbc Emerging Markets on September 10, 2025 and sell it today you would earn a total of  99.00  from holding Rbc Emerging Markets or generate 9.74% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

Rbc Emerging Markets  vs.  Small Cap Index

Rbc Emerging Markets

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Rbc Emerging Markets are ranked lower than 13 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak basic indicators, Rbc Emerging may actually be approaching a critical reversion point that can send shares even higher in January 2026.

Small Cap Index

Risk-Adjusted Performance

Mild

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

Pair Trading with Rbc Emerging and Small Cap

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

The idea behind Rbc Emerging Markets and Small Cap Index 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 Money Managers module to screen money managers from public funds and ETFs managed around the world.