Correlation Between Sextant International and Simt Mid

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

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

Diversification Opportunities for Sextant International and Simt Mid

0.21

Correlation Coefficient

Sextant International  Simt Mid

Modest diversification

The 3 months correlation between Sextant and Simt is 0.21. Overlapping area represents the amount of risk that can be diversified away by holding Sextant International Fund and Simt Mid Cap in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Simt Mid Cap and Sextant 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 Sextant International Fund are associated (or correlated) with Simt Mid. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Simt Mid Cap has no effect on the direction of Sextant International i.e., Sextant International and Simt Mid go up and down completely randomly.

Pair Corralation between Sextant International and Simt Mid

Assuming the 90 days horizon Sextant International Fund is expected to generate 1.46 times more return on investment than Simt Mid. However, Sextant International is 1.46 times more volatile than Simt Mid Cap. It trades about 0.07 of its potential returns per unit of risk. Simt Mid Cap is currently generating about -0.03 per unit of risk. If you would invest  2,517  in Sextant International Fund on August 26, 2025 and sell it today you would earn a total of  128.00  from holding Sextant International Fund or generate 5.09% return on investment over 90 days.

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

Sextant International Fund  vs.  Simt Mid Cap

Sextant International

Risk-Adjusted Performance

Mild

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

Simt Mid Cap

Risk-Adjusted Performance

Weakest

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

Pair Trading with Sextant International and Simt Mid

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

The idea behind Sextant International Fund and Simt Mid Cap 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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.