Correlation Between Federated Mdt and Meridian Growth
Can any of the company-specific risk be diversified away by investing in both Federated Mdt and Meridian Growth 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 Federated Mdt and Meridian Growth into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Federated Mdt Large and Meridian Growth Fund, you can compare the effects of market volatilities on Federated Mdt and Meridian Growth 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 Federated Mdt with a short position of Meridian Growth. Check out your portfolio center. Please also check ongoing floating volatility patterns of Federated Mdt and Meridian Growth.
Diversification Opportunities for Federated Mdt and Meridian Growth
0.67 | Correlation Coefficient |
Poor diversification
The 3 months correlation between FEDERATED and Meridian is 0.67. Overlapping area represents the amount of risk that can be diversified away by holding Federated Mdt Large and Meridian Growth Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Meridian Growth and Federated Mdt 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 Federated Mdt Large are associated (or correlated) with Meridian Growth. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Meridian Growth has no effect on the direction of Federated Mdt i.e., Federated Mdt and Meridian Growth go up and down completely randomly.
Pair Corralation between Federated Mdt and Meridian Growth
Assuming the 90 days horizon Federated Mdt Large is expected to generate 0.63 times more return on investment than Meridian Growth. However, Federated Mdt Large is 1.57 times less risky than Meridian Growth. It trades about 0.35 of its potential returns per unit of risk. Meridian Growth Fund is currently generating about 0.2 per unit of risk. If you would invest 3,506 in Federated Mdt Large on August 26, 2024 and sell it today you would earn a total of 224.00 from holding Federated Mdt Large or generate 6.39% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Federated Mdt Large vs. Meridian Growth Fund
Performance |
| Timeline |
| Federated Mdt Large |
| Meridian Growth |
Federated Mdt and Meridian Growth Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Federated Mdt and Meridian Growth
The main advantage of trading using opposite Federated Mdt and Meridian Growth positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Federated Mdt position performs unexpectedly, Meridian Growth 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 Meridian Growth will offset losses from the drop in Meridian Growth's long position.| Federated Mdt vs. Federated Emerging Market | Federated Mdt vs. Federated Mdt All | Federated Mdt vs. Federated Mdt Balanced | Federated Mdt vs. Federated Global Allocation |
| Meridian Growth vs. T Rowe Price | Meridian Growth vs. Tfa Alphagen Growth | Meridian Growth vs. Praxis Growth Index | Meridian Growth vs. Victory Rs Growth |
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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