Correlation Between Guidemark(r) Small/mid and Glg Intl
Can any of the company-specific risk be diversified away by investing in both Guidemark(r) Small/mid and Glg Intl 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 Guidemark(r) Small/mid and Glg Intl into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Guidemark Smallmid Cap and Glg Intl Small, you can compare the effects of market volatilities on Guidemark(r) Small/mid and Glg Intl 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 Guidemark(r) Small/mid with a short position of Glg Intl. Check out your portfolio center. Please also check ongoing floating volatility patterns of Guidemark(r) Small/mid and Glg Intl.
Diversification Opportunities for Guidemark(r) Small/mid and Glg Intl
0.88 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Guidemark(r) and Glg is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding Guidemark Smallmid Cap and Glg Intl Small in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Glg Intl Small and Guidemark(r) Small/mid 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 Guidemark Smallmid Cap are associated (or correlated) with Glg Intl. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Glg Intl Small has no effect on the direction of Guidemark(r) Small/mid i.e., Guidemark(r) Small/mid and Glg Intl go up and down completely randomly.
Pair Corralation between Guidemark(r) Small/mid and Glg Intl
Assuming the 90 days horizon Guidemark Smallmid Cap is expected to generate 1.56 times more return on investment than Glg Intl. However, Guidemark(r) Small/mid is 1.56 times more volatile than Glg Intl Small. It trades about 0.29 of its potential returns per unit of risk. Glg Intl Small is currently generating about 0.18 per unit of risk. If you would invest 1,978 in Guidemark Smallmid Cap on June 10, 2025 and sell it today you would earn a total of 138.00 from holding Guidemark Smallmid Cap or generate 6.98% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Guidemark Smallmid Cap vs. Glg Intl Small
Performance |
| Timeline |
| Guidemark Smallmid Cap |
| Glg Intl Small |
Guidemark(r) Small/mid and Glg Intl Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Guidemark(r) Small/mid and Glg Intl
The main advantage of trading using opposite Guidemark(r) Small/mid and Glg Intl positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Guidemark(r) Small/mid position performs unexpectedly, Glg Intl 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 Glg Intl will offset losses from the drop in Glg Intl's long position.| Guidemark(r) Small/mid vs. Bbh Intermediate Municipal | Guidemark(r) Small/mid vs. Rbc Short Duration | Guidemark(r) Small/mid vs. T Rowe Price | Guidemark(r) Small/mid vs. Intermediate Term Bond Fund |
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Check out your portfolio center.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 Portfolio Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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