Correlation Between Meridian Growth and Clearbridge Mid
Can any of the company-specific risk be diversified away by investing in both Meridian Growth and Clearbridge Mid 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 Meridian Growth and Clearbridge Mid into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Meridian Growth Fund and Clearbridge Mid Cap, you can compare the effects of market volatilities on Meridian Growth and Clearbridge Mid 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 Meridian Growth with a short position of Clearbridge Mid. Check out your portfolio center. Please also check ongoing floating volatility patterns of Meridian Growth and Clearbridge Mid.
Diversification Opportunities for Meridian Growth and Clearbridge Mid
0.79 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Meridian and Clearbridge is 0.79. Overlapping area represents the amount of risk that can be diversified away by holding Meridian Growth Fund and Clearbridge Mid Cap in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Clearbridge Mid Cap and Meridian Growth 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 Meridian Growth Fund are associated (or correlated) with Clearbridge Mid. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Clearbridge Mid Cap has no effect on the direction of Meridian Growth i.e., Meridian Growth and Clearbridge Mid go up and down completely randomly.
Pair Corralation between Meridian Growth and Clearbridge Mid
Assuming the 90 days horizon Meridian Growth is expected to generate 1.49 times less return on investment than Clearbridge Mid. In addition to that, Meridian Growth is 1.06 times more volatile than Clearbridge Mid Cap. It trades about 0.04 of its total potential returns per unit of risk. Clearbridge Mid Cap is currently generating about 0.07 per unit of volatility. If you would invest 3,248 in Clearbridge Mid Cap on August 24, 2024 and sell it today you would earn a total of 894.00 from holding Clearbridge Mid Cap or generate 27.52% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Meridian Growth Fund vs. Clearbridge Mid Cap
Performance |
| Timeline |
| Meridian Growth |
| Clearbridge Mid Cap |
Meridian Growth and Clearbridge Mid Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Meridian Growth and Clearbridge Mid
The main advantage of trading using opposite Meridian Growth and Clearbridge Mid positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Meridian Growth position performs unexpectedly, Clearbridge Mid 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 Clearbridge Mid will offset losses from the drop in Clearbridge Mid's long position.| Meridian Growth vs. Technology Ultrasector Profund | Meridian Growth vs. Invesco Technology Fund | Meridian Growth vs. Columbia Global Technology | Meridian Growth vs. Janus Global Technology |
| Clearbridge Mid vs. Fam Equity Income Fund | Clearbridge Mid vs. Meridian Growth Fund | Clearbridge Mid vs. Muhlenkamp Fund Institutional | Clearbridge Mid vs. Royce Pennsylvania Mutual |
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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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