Correlation Between Boston Trust and Walden Midcap

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Can any of the company-specific risk be diversified away by investing in both Boston Trust and Walden Midcap 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 Boston Trust and Walden Midcap into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Boston Trust Smid and Walden Midcap Fund, you can compare the effects of market volatilities on Boston Trust and Walden Midcap 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 Boston Trust with a short position of Walden Midcap. Check out your portfolio center. Please also check ongoing floating volatility patterns of Boston Trust and Walden Midcap.

Diversification Opportunities for Boston Trust and Walden Midcap

BostonWaldenDiversified AwayBostonWaldenDiversified Away100%
0.0
  Correlation Coefficient

Pay attention - limited upside

The 3 months correlation between Boston and Walden is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Boston Trust Smid and Walden Midcap Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Walden Midcap and Boston Trust 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 Boston Trust Smid are associated (or correlated) with Walden Midcap. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Walden Midcap has no effect on the direction of Boston Trust i.e., Boston Trust and Walden Midcap go up and down completely randomly.

Pair Corralation between Boston Trust and Walden Midcap

If you would invest  1,947  in Walden Midcap Fund on December 12, 2024 and sell it today you would earn a total of  298.00  from holding Walden Midcap Fund or generate 15.31% return on investment over 90 days.
Time Period3 Months [change]
DirectionFlat 
StrengthInsignificant
Accuracy0.2%
ValuesDaily Returns

Boston Trust Smid  vs.  Walden Midcap Fund

 Performance 
JavaScript chart by amCharts 3.21.15Dec2025Feb 1234567
JavaScript chart by amCharts 3.21.15BTSMX WAMFX
       Timeline  
Boston Trust Smid 

Risk-Adjusted Performance

Very Weak

 
Weak
 
Strong
Over the last 90 days Boston Trust Smid has generated negative risk-adjusted returns adding no value to fund investors. In spite of fairly strong primary indicators, Boston Trust is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.
Walden Midcap 

Risk-Adjusted Performance

Very Weak

 
Weak
 
Strong
Over the last 90 days Walden Midcap Fund has generated negative risk-adjusted returns adding no value to fund investors. In spite of latest weak performance, the Fund's technical and fundamental indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the fund investors.
JavaScript chart by amCharts 3.21.15JanFebMarFebMar22.52323.52424.5

Boston Trust and Walden Midcap Volatility Contrast

   Predicted Return Density   
JavaScript chart by amCharts 3.21.15 0.10.20.30.40.5
JavaScript chart by amCharts 3.21.15BTSMX WAMFX
       Returns  

Pair Trading with Boston Trust and Walden Midcap

The main advantage of trading using opposite Boston Trust and Walden Midcap positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Boston Trust position performs unexpectedly, Walden Midcap 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 Walden Midcap will offset losses from the drop in Walden Midcap's long position.
The idea behind Boston Trust Smid and Walden Midcap Fund pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
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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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.

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