Correlation Between Mid Cap and Sentinel International
Can any of the company-specific risk be diversified away by investing in both Mid Cap and Sentinel International 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 and Sentinel International into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Mid Cap Growth and Sentinel International Equity, you can compare the effects of market volatilities on Mid Cap and Sentinel International 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 with a short position of Sentinel International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mid Cap and Sentinel International.
Diversification Opportunities for Mid Cap and Sentinel International
0.73 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Mid and Sentinel is 0.73. Overlapping area represents the amount of risk that can be diversified away by holding Mid Cap Growth and Sentinel International Equity in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sentinel International and Mid Cap 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 are associated (or correlated) with Sentinel International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sentinel International has no effect on the direction of Mid Cap i.e., Mid Cap and Sentinel International go up and down completely randomly.
Pair Corralation between Mid Cap and Sentinel International
Assuming the 90 days horizon Mid Cap is expected to generate 1.09 times less return on investment than Sentinel International. In addition to that, Mid Cap is 1.2 times more volatile than Sentinel International Equity. It trades about 0.15 of its total potential returns per unit of risk. Sentinel International Equity is currently generating about 0.2 per unit of volatility. If you would invest 1,570 in Sentinel International Equity on May 29, 2025 and sell it today you would earn a total of 144.00 from holding Sentinel International Equity or generate 9.17% 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 vs. Sentinel International Equity
Performance |
| Timeline |
| Mid Cap Growth |
| Sentinel International |
Mid Cap and Sentinel International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Mid Cap and Sentinel International
The main advantage of trading using opposite Mid Cap and Sentinel International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mid Cap position performs unexpectedly, Sentinel International 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 Sentinel International will offset losses from the drop in Sentinel International's long position.| Mid Cap vs. Wasatch Small Cap | Mid Cap vs. Victory Trivalent International | Mid Cap vs. John Hancock Disciplined | Mid Cap vs. Mfs Mid Cap |
| Sentinel International vs. Sentinel Balanced Fund | Sentinel International vs. Sentinel Mon Stock | Sentinel International vs. Sentinel Balanced Fund | Sentinel International vs. Sentinel International Equity |
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 Center module to all portfolio management and optimization tools to improve performance of your portfolios.
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