Correlation Between Mid-cap 15x and Sp 500
Can any of the company-specific risk be diversified away by investing in both Mid-cap 15x and Sp 500 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 Mid-cap 15x and Sp 500 into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Mid Cap 15x Strategy and Sp 500 Fund, you can compare the effects of market volatilities on Mid-cap 15x and Sp 500 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 Mid-cap 15x with a short position of Sp 500. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mid-cap 15x and Sp 500.
Diversification Opportunities for Mid-cap 15x and Sp 500
0.95 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Mid-cap and RYSOX is 0.95. Overlapping area represents the amount of risk that can be diversified away by holding Mid Cap 15x Strategy and Sp 500 Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sp 500 Fund and Mid-cap 15x 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 Mid Cap 15x Strategy are associated (or correlated) with Sp 500. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sp 500 Fund has no effect on the direction of Mid-cap 15x i.e., Mid-cap 15x and Sp 500 go up and down completely randomly.
Pair Corralation between Mid-cap 15x and Sp 500
Assuming the 90 days horizon Mid Cap 15x Strategy is expected to generate 1.97 times more return on investment than Sp 500. However, Mid-cap 15x is 1.97 times more volatile than Sp 500 Fund. It trades about 0.07 of its potential returns per unit of risk. Sp 500 Fund is currently generating about 0.12 per unit of risk. If you would invest 8,326 in Mid Cap 15x Strategy on August 31, 2024 and sell it today you would earn a total of 3,602 from holding Mid Cap 15x Strategy or generate 43.26% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 99.73% |
| Values | Daily Returns |
Mid Cap 15x Strategy vs. Sp 500 Fund
Performance |
| Timeline |
| Mid Cap 15x |
| Sp 500 Fund |
Mid-cap 15x and Sp 500 Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Mid-cap 15x and Sp 500
The main advantage of trading using opposite Mid-cap 15x and Sp 500 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mid-cap 15x position performs unexpectedly, Sp 500 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 Sp 500 will offset losses from the drop in Sp 500's long position.| Mid-cap 15x vs. Alger Health Sciences | Mid-cap 15x vs. Prudential Health Sciences | Mid-cap 15x vs. Health Biotchnology Portfolio | Mid-cap 15x vs. Alphacentric Lifesci Healthcare |
| Sp 500 vs. John Hancock Financial | Sp 500 vs. Icon Financial Fund | Sp 500 vs. Royce Global Financial | Sp 500 vs. Fidelity Advisor Financial |
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 Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
Other Complementary Tools
| Idea Optimizer Use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio | |
| Money Managers Screen money managers from public funds and ETFs managed around the world | |
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
| Watchlist Optimization Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm | |
| Analyst Advice Analyst recommendations and target price estimates broken down by several categories |