Correlation Between Perkins Small and Smallcap Growth
Can any of the company-specific risk be diversified away by investing in both Perkins Small and Smallcap Growth 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 Perkins Small and Smallcap Growth into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Perkins Small Cap and Smallcap Growth Fund, you can compare the effects of market volatilities on Perkins Small and Smallcap Growth 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 Perkins Small with a short position of Smallcap Growth. Check out your portfolio center. Please also check ongoing floating volatility patterns of Perkins Small and Smallcap Growth.
Diversification Opportunities for Perkins Small and Smallcap Growth
0.94 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Perkins and Smallcap is 0.94. Overlapping area represents the amount of risk that can be diversified away by holding Perkins Small Cap and Smallcap Growth Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Smallcap Growth and Perkins Small 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 Perkins Small Cap are associated (or correlated) with Smallcap Growth. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Smallcap Growth has no effect on the direction of Perkins Small i.e., Perkins Small and Smallcap Growth go up and down completely randomly.
Pair Corralation between Perkins Small and Smallcap Growth
Assuming the 90 days horizon Perkins Small Cap is expected to generate 1.14 times more return on investment than Smallcap Growth. However, Perkins Small is 1.14 times more volatile than Smallcap Growth Fund. It trades about 0.19 of its potential returns per unit of risk. Smallcap Growth Fund is currently generating about 0.18 per unit of risk. If you would invest 2,061 in Perkins Small Cap on May 31, 2025 and sell it today you would earn a total of 298.00 from holding Perkins Small Cap or generate 14.46% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 98.41% |
| Values | Daily Returns |
Perkins Small Cap vs. Smallcap Growth Fund
Performance |
| Timeline |
| Perkins Small Cap |
| Smallcap Growth |
Perkins Small and Smallcap Growth Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Perkins Small and Smallcap Growth
The main advantage of trading using opposite Perkins Small and Smallcap Growth positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Perkins Small position performs unexpectedly, Smallcap Growth 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 Smallcap Growth will offset losses from the drop in Smallcap Growth's long position.| Perkins Small vs. Janus Overseas Fund | Perkins Small vs. Janus Balanced Fund | Perkins Small vs. Perkins Mid Cap | Perkins Small vs. Janus Enterprise Fund |
| Smallcap Growth vs. Queens Road Small | Smallcap Growth vs. Perkins Small Cap | Smallcap Growth vs. Pace Smallmedium Value | Smallcap Growth vs. Omni Small Cap Value |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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