Correlation Between Mid-cap Growth and Intermediate Government
Can any of the company-specific risk be diversified away by investing in both Mid-cap Growth and Intermediate Government 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 Mid-cap Growth and Intermediate Government into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Mid Cap Growth Profund and Intermediate Government Bond, you can compare the effects of market volatilities on Mid-cap Growth and Intermediate Government 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 Mid-cap Growth with a short position of Intermediate Government. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mid-cap Growth and Intermediate Government.
Diversification Opportunities for Mid-cap Growth and Intermediate Government
0.61 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Mid-cap and Intermediate is 0.61. Overlapping area represents the amount of risk that can be diversified away by holding Mid Cap Growth Profund and Intermediate Government Bond in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Intermediate Government and Mid-cap Growth 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 Mid Cap Growth Profund are associated (or correlated) with Intermediate Government. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Intermediate Government has no effect on the direction of Mid-cap Growth i.e., Mid-cap Growth and Intermediate Government go up and down completely randomly.
Pair Corralation between Mid-cap Growth and Intermediate Government
If you would invest 10,291 in Mid Cap Growth Profund on April 16, 2025 and sell it today you would earn a total of 390.00 from holding Mid Cap Growth Profund or generate 3.79% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Mid Cap Growth Profund vs. Intermediate Government Bond
Performance |
| Timeline |
| Mid Cap Growth |
| Intermediate Government |
Mid-cap Growth and Intermediate Government Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Mid-cap Growth and Intermediate Government
The main advantage of trading using opposite Mid-cap Growth and Intermediate Government positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mid-cap Growth position performs unexpectedly, Intermediate Government 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 Intermediate Government will offset losses from the drop in Intermediate Government's long position.| Mid-cap Growth vs. Small Cap Growth Profund | Mid-cap Growth vs. Mid Cap Value Profund | Mid-cap Growth vs. Small Cap Value Profund | Mid-cap Growth vs. Mid Cap Profund Mid Cap |
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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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