Correlation Between High Yield and Touchstone Mid
Can any of the company-specific risk be diversified away by investing in both High Yield and Touchstone 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 High Yield and Touchstone Mid into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between High Yield Fund and Touchstone Mid Cap, you can compare the effects of market volatilities on High Yield and Touchstone 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 High Yield with a short position of Touchstone Mid. Check out your portfolio center. Please also check ongoing floating volatility patterns of High Yield and Touchstone Mid.
Diversification Opportunities for High Yield and Touchstone Mid
0.07 | Correlation Coefficient |
Significant diversification
The 3 months correlation between High and Touchstone is 0.07. Overlapping area represents the amount of risk that can be diversified away by holding High Yield Fund and Touchstone Mid Cap in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Touchstone Mid Cap and High Yield 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 High Yield Fund are associated (or correlated) with Touchstone Mid. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Touchstone Mid Cap has no effect on the direction of High Yield i.e., High Yield and Touchstone Mid go up and down completely randomly.
Pair Corralation between High Yield and Touchstone Mid
Assuming the 90 days horizon High Yield Fund is expected to generate 0.24 times more return on investment than Touchstone Mid. However, High Yield Fund is 4.09 times less risky than Touchstone Mid. It trades about -0.03 of its potential returns per unit of risk. Touchstone Mid Cap is currently generating about -0.25 per unit of risk. If you would invest 747.00 in High Yield Fund on December 1, 2024 and sell it today you would lose (1.00) from holding High Yield Fund or give up 0.13% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
High Yield Fund vs. Touchstone Mid Cap
Performance |
| Timeline |
| High Yield Fund |
| Touchstone Mid Cap |
High Yield and Touchstone Mid Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with High Yield and Touchstone Mid
The main advantage of trading using opposite High Yield and Touchstone Mid positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if High Yield position performs unexpectedly, Touchstone 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 Touchstone Mid will offset losses from the drop in Touchstone Mid's long position.| High Yield vs. Guidemark Large Cap | High Yield vs. Gmo Asset Allocation | High Yield vs. Enhanced Large Pany | High Yield vs. T Rowe Price |
| Touchstone Mid vs. High Yield Fund Investor | Touchstone Mid vs. Voya High Yield | Touchstone Mid vs. Multi Manager High Yield | Touchstone Mid vs. Simt High Yield |
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 Directory module to find actively traded commodities issued by global exchanges.
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