Correlation Between Credit Suisse and Sit Developing

Can any of the company-specific risk be diversified away by investing in both Credit Suisse and Sit Developing 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 Credit Suisse and Sit Developing into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Credit Suisse X Links and Sit Developing Markets, you can compare the effects of market volatilities on Credit Suisse and Sit Developing 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 Credit Suisse with a short position of Sit Developing. Check out your portfolio center. Please also check ongoing floating volatility patterns of Credit Suisse and Sit Developing.

Diversification Opportunities for Credit Suisse and Sit Developing

0.66

Correlation Coefficient

Credit Suisse  Sit Developing

Poor diversification

The 3 months correlation between Credit and Sit is 0.66. Overlapping area represents the amount of risk that can be diversified away by holding Credit Suisse X Links and Sit Developing Markets in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sit Developing Markets and Credit Suisse 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 Credit Suisse X Links are associated (or correlated) with Sit Developing. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sit Developing Markets has no effect on the direction of Credit Suisse i.e., Credit Suisse and Sit Developing go up and down completely randomly.

Pair Corralation between Credit Suisse and Sit Developing

Given the investment horizon of 90 days Credit Suisse X Links is expected to generate 1.31 times more return on investment than Sit Developing. However, Credit Suisse is 1.31 times more volatile than Sit Developing Markets. It trades about 0.23 of its potential returns per unit of risk. Sit Developing Markets is currently generating about 0.24 per unit of risk. If you would invest  4,634  in Credit Suisse X Links on May 4, 2025 and sell it today you would earn a total of  736.00  from holding Credit Suisse X Links or generate 15.88% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	98.41%
Values	Daily Returns

Credit Suisse X Links  vs.  Sit Developing Markets

Credit Suisse X

Risk-Adjusted Performance

Solid

Over the last 90 days Credit Suisse X Links has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fairly weak basic indicators, Credit Suisse demonstrated solid returns over the last few months and may actually be approaching a breakup point.

Sit Developing Markets

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Sit Developing Markets are ranked lower than 18 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak technical and fundamental indicators, Sit Developing may actually be approaching a critical reversion point that can send shares even higher in September 2025.

Pair Trading with Credit Suisse and Sit Developing

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

The idea behind Credit Suisse X Links and Sit Developing Markets 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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.