Correlation Between High Yield and Touchstone Funds
Can any of the company-specific risk be diversified away by investing in both High Yield and Touchstone Funds 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 High Yield and Touchstone Funds into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between High Yield Fund and Touchstone Funds Group, you can compare the effects of market volatilities on High Yield and Touchstone Funds 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 High Yield with a short position of Touchstone Funds. Check out your portfolio center. Please also check ongoing floating volatility patterns of High Yield and Touchstone Funds.
Diversification Opportunities for High Yield and Touchstone Funds
0.85 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between High and Touchstone is 0.85. Overlapping area represents the amount of risk that can be diversified away by holding High Yield Fund and Touchstone Funds Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Touchstone Funds and High Yield 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 High Yield Fund are associated (or correlated) with Touchstone Funds. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Touchstone Funds has no effect on the direction of High Yield i.e., High Yield and Touchstone Funds go up and down completely randomly.
Pair Corralation between High Yield and Touchstone Funds
Assuming the 90 days horizon High Yield Fund is expected to generate 0.52 times more return on investment than Touchstone Funds. However, High Yield Fund is 1.92 times less risky than Touchstone Funds. It trades about 0.25 of its potential returns per unit of risk. Touchstone Funds Group is currently generating about 0.05 per unit of risk. If you would invest 773.00 in High Yield Fund on June 6, 2025 and sell it today you would earn a total of 5.00 from holding High Yield Fund or generate 0.65% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
High Yield Fund vs. Touchstone Funds Group
Performance |
| Timeline |
| High Yield Fund |
| Touchstone Funds |
High Yield and Touchstone Funds Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with High Yield and Touchstone Funds
The main advantage of trading using opposite High Yield and Touchstone Funds positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if High Yield position performs unexpectedly, Touchstone Funds 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 Touchstone Funds will offset losses from the drop in Touchstone Funds' long position.| High Yield vs. Sp Smallcap 600 | High Yield vs. Jhvit International Small | High Yield vs. Touchstone Small Cap | High Yield vs. Vanguard Strategic Small Cap |
| Touchstone Funds vs. Hartford Healthcare Hls | Touchstone Funds vs. Schwab Health Care | Touchstone Funds vs. Health Care Ultrasector | Touchstone Funds vs. The Hartford Healthcare |
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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.
Other Complementary Tools
| Bonds Directory Find actively traded corporate debentures issued by US companies | |
| Options Analysis Analyze and evaluate options and option chains as a potential hedge for your portfolios | |
| Top Crypto Exchanges Search and analyze digital assets across top global cryptocurrency exchanges | |
| Portfolio Volatility Check portfolio volatility and analyze historical return density to properly model market risk | |
| Idea Breakdown Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes |