Correlation Between SM Investments and SmartSet Automation

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

By analyzing existing cross correlation between SM Investments and SmartSet Automation LLC, you can compare the effects of market volatilities on SM Investments and SmartSet Automation 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 SM Investments with a short position of SmartSet Automation. Check out your portfolio center. Please also check ongoing floating volatility patterns of SM Investments and SmartSet Automation.

Diversification Opportunities for SM Investments and SmartSet Automation

-0.11

Correlation Coefficient

SM Investments  SmartSet Automation

Good diversification

The 3 months correlation between SVTMF and SmartSet is -0.11. Overlapping area represents the amount of risk that can be diversified away by holding SM Investments and SmartSet Automation LLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SmartSet Automation LLC and SM Investments 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 SM Investments are associated (or correlated) with SmartSet Automation. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SmartSet Automation LLC has no effect on the direction of SM Investments i.e., SM Investments and SmartSet Automation go up and down completely randomly.

Pair Corralation between SM Investments and SmartSet Automation

If you would invest  0.15  in SmartSet Automation LLC on May 15, 2025 and sell it today you would earn a total of  0.02  from holding SmartSet Automation LLC or generate 13.33% return on investment over 90 days.

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

SM Investments  vs.  SmartSet Automation LLC

SM Investments

Risk-Adjusted Performance

Weakest

Over the last 90 days SM Investments has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable primary indicators, SM Investments is not utilizing all of its potentials. The recent stock price disturbance, may contribute to mid-run losses for the stockholders.

SmartSet Automation LLC

Risk-Adjusted Performance

Fair

Compared to the overall equity markets, risk-adjusted returns on investments in SmartSet Automation LLC are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. In spite of rather weak fundamental indicators, SmartSet Automation exhibited solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with SM Investments and SmartSet Automation

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

The idea behind SM Investments and SmartSet Automation LLC 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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.