Correlation Between Champlain Mid and Heartland Value
Can any of the company-specific risk be diversified away by investing in both Champlain Mid and Heartland Value 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 Champlain Mid and Heartland Value into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Champlain Mid Cap and Heartland Value Plus, you can compare the effects of market volatilities on Champlain Mid and Heartland Value 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 Champlain Mid with a short position of Heartland Value. Check out your portfolio center. Please also check ongoing floating volatility patterns of Champlain Mid and Heartland Value.
Diversification Opportunities for Champlain Mid and Heartland Value
0.96 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Champlain and Heartland is 0.96. Overlapping area represents the amount of risk that can be diversified away by holding Champlain Mid Cap and Heartland Value Plus in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Heartland Value Plus and Champlain Mid 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 Champlain Mid Cap are associated (or correlated) with Heartland Value. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Heartland Value Plus has no effect on the direction of Champlain Mid i.e., Champlain Mid and Heartland Value go up and down completely randomly.
Pair Corralation between Champlain Mid and Heartland Value
Assuming the 90 days horizon Champlain Mid Cap is expected to generate 0.75 times more return on investment than Heartland Value. However, Champlain Mid Cap is 1.33 times less risky than Heartland Value. It trades about 0.23 of its potential returns per unit of risk. Heartland Value Plus is currently generating about 0.14 per unit of risk. If you would invest 2,305 in Champlain Mid Cap on November 5, 2024 and sell it today you would earn a total of 77.00 from holding Champlain Mid Cap or generate 3.34% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Champlain Mid Cap vs. Heartland Value Plus
Performance |
| Timeline |
| Champlain Mid Cap |
| Heartland Value Plus |
Champlain Mid and Heartland Value Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Champlain Mid and Heartland Value
The main advantage of trading using opposite Champlain Mid and Heartland Value positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Champlain Mid position performs unexpectedly, Heartland Value 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 Heartland Value will offset losses from the drop in Heartland Value's long position.| Champlain Mid vs. Champlain Small Pany | Champlain Mid vs. T Rowe Price | Champlain Mid vs. American Mutual Fund | Champlain Mid vs. Loomis Sayles Growth |
| Heartland Value vs. Heartland Value Fund | Heartland Value vs. Large Cap Fund | Heartland Value vs. Amg Yacktman Fund | Heartland Value vs. Wasatch Large 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 Portfolio Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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