Correlation Between Midcap Fund and Polen Us
Can any of the company-specific risk be diversified away by investing in both Midcap Fund and Polen Us 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 Midcap Fund and Polen Us into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Midcap Fund Class and Polen Smid, you can compare the effects of market volatilities on Midcap Fund and Polen Us 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 Midcap Fund with a short position of Polen Us. Check out your portfolio center. Please also check ongoing floating volatility patterns of Midcap Fund and Polen Us.
Diversification Opportunities for Midcap Fund and Polen Us
0.95 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Midcap and Polen is 0.95. Overlapping area represents the amount of risk that can be diversified away by holding Midcap Fund Class and Polen Smid in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Polen Smid and Midcap Fund 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 Midcap Fund Class are associated (or correlated) with Polen Us. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Polen Smid has no effect on the direction of Midcap Fund i.e., Midcap Fund and Polen Us go up and down completely randomly.
Pair Corralation between Midcap Fund and Polen Us
Assuming the 90 days horizon Midcap Fund is expected to generate 1.49 times less return on investment than Polen Us. But when comparing it to its historical volatility, Midcap Fund Class is 1.44 times less risky than Polen Us. It trades about 0.35 of its potential returns per unit of risk. Polen Smid is currently generating about 0.36 of returns per unit of risk over similar time horizon. If you would invest 801.00 in Polen Smid on August 30, 2024 and sell it today you would earn a total of 93.00 from holding Polen Smid or generate 11.61% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Midcap Fund Class vs. Polen Smid
Performance |
| Timeline |
| Midcap Fund Class |
| Polen Smid |
Midcap Fund and Polen Us Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Midcap Fund and Polen Us
The main advantage of trading using opposite Midcap Fund and Polen Us positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Midcap Fund position performs unexpectedly, Polen Us 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 Polen Us will offset losses from the drop in Polen Us' long position.| Midcap Fund vs. Strategic Asset Management | Midcap Fund vs. Strategic Asset Management | Midcap Fund vs. Strategic Asset Management | Midcap Fund vs. Strategic Asset Management |
| Polen Us vs. Prnpl Inv Fd | Polen Us vs. Polen Global Growth | Polen Us vs. Polen Global Growth | Polen Us vs. Polen International 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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
Other Complementary Tools
| Analyst Advice Analyst recommendations and target price estimates broken down by several categories | |
| Stocks Directory Find actively traded stocks across global markets | |
| Portfolio Suggestion Get suggestions outside of your existing asset allocation including your own model portfolios | |
| Risk-Return Analysis View associations between returns expected from investment and the risk you assume | |
| Odds Of Bankruptcy Get analysis of equity chance of financial distress in the next 2 years |