Highland Merger Correlations

HMECX Fund

USD 18.92 0.01 0.05%

The current 90-days correlation between Highland Merger Arbitrage and Highland Longshort Healthcare is 0.53 (i.e., Very weak diversification). The correlation of Highland Merger is a statistical measure of how it moves in relation to other instruments. This measure is expressed in what is known as the correlation coefficient, which ranges between -1 and +1. A correlation greater than 0.8 is generally described as strong, whereas a correlation less than 0.5 is generally considered weak. If the correlation is 0, the equities are not correlated; they are entirely random.

Highland Merger Correlation With Market

Average diversification

The correlation between Highland Merger Arbitrage and DJI is 0.15 (i.e., Average diversification) for selected investment horizon. Overlapping area represents the amount of risk that can be diversified away by holding Highland Merger Arbitrage and DJI in the same portfolio, assuming nothing else is changed.

Check out Risk vs Return Analysis to better understand how to build diversified portfolios, which includes a position in Highland Merger Arbitrage. Also, note that the market value of any mutual fund could be closely tied with the direction of predictive economic indicators such as signals in main economic indicators.

Moving together with Highland Mutual Fund

1.0	HMEAX	Highland Merger Arbitrage	Pair Corr
1.0	HMEZX	Highland Merger Arbitrage	Pair Corr
0.61	BALPX	Blckrk Lc Cr	Pair Corr
0.63	BILPX	Blkrk Lc Cr	Pair Corr
0.7	MERIX	Merger Fund	Pair Corr
0.7	MERFX	Merger Fund	Pair Corr
0.83	ARBCX	The Arbitrage	Pair Corr
0.88	ARBNX	The Arbitrage	Pair Corr
0.83	EFEAX	Ashmore Emerging Markets	Pair Corr
0.75	RTEHX	American High Income	Pair Corr
0.75	OANIX	Oakmark International	Pair Corr
0.65	TWAIX	Thrivent Partner Wor	Pair Corr
0.89	BLDAX	Blackrock Low Duration	Pair Corr
0.94	HFHTX	Hartford Floating	Pair Corr

Moving against Highland Mutual Fund

0.75	SMPIX	Semiconductor Ultrasector	Pair Corr
0.43	HSZCX	Highland Small Cap	Pair Corr
0.4	HSZAX	Highland Small Cap	Pair Corr
0.4	VARCX	First Trust Merger	Pair Corr
0.39	HSZYX	Highland Small Cap	Pair Corr
0.37	VARAX	Vivaldi Merger Arbitrage	Pair Corr
0.34	VARBX	Vivaldi Merger Arbitrage	Pair Corr
0.82	SMPSX	Semiconductor Ultrasector	Pair Corr
0.51	RGNCX	Victory Global Natural	Pair Corr
0.5	RSNYX	Victory Global Natural	Pair Corr
0.5	RSNRX	Victory Global Natural	Pair Corr
0.5	FELAX	Fidelity Advisor Sem	Pair Corr
0.46	FELIX	Fidelity Advisor Sem	Pair Corr
0.45	FIKGX	Fidelity Advisor Sem	Pair Corr
0.37	FSELX	Fidelity Select Semi	Pair Corr

Related Correlations Analysis

	HHCAX	HHCCX	HSZYX	HSZAX	HSZCX	HMEAX	HMECX	HMEZX
HHCAX		0.99	0.55	0.55	0.52	0.4	0.42	0.39	HHCAX
HHCCX	0.99		0.62	0.62	0.59	0.3	0.32	0.29	HHCCX
HSZYX	0.55	0.62		1.0	1.0	-0.41	-0.39	-0.42	HSZYX
HSZAX	0.55	0.62	1.0		1.0	-0.41	-0.4	-0.42	HSZAX
HSZCX	0.52	0.59	1.0	1.0		-0.44	-0.43	-0.45	HSZCX
HMEAX	0.4	0.3	-0.41	-0.41	-0.44		1.0	1.0	HMEAX
HMECX	0.42	0.32	-0.39	-0.4	-0.43	1.0		1.0	HMECX
HMEZX	0.39	0.29	-0.42	-0.42	-0.45	1.0	1.0		HMEZX
	HHCAX	HHCCX	HSZYX	HSZAX	HSZCX	HMEAX	HMECX	HMEZX

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Correlation Matchups

Over a given time period, the two securities move together when the Correlation Coefficient is positive. Conversely, the two assets move in opposite directions when the Correlation Coefficient is negative. Determining your positions' relationship to each other is valuable for analyzing and projecting your portfolio's future expected return and risk.

High positive correlations

HSZAX	+ 1.0	HSZYX
HSZCX	+ 1.0	HSZYX
HSZCX	+ 1.0	HSZAX
HMECX	+ 1.0	HMEAX
HMEZX	+ 1.0	HMEAX
HMEZX	+ 1.0	HMECX

High negative correlations

HMEZX	- 0.45	HSZCX
HMEAX	- 0.44	HSZCX
HMECX	- 0.43	HSZCX
HMEZX	- 0.42	HSZAX
HMEZX	- 0.42	HSZYX
HMEAX	- 0.41	HSZAX

Risk-Adjusted Indicators

There is a big difference between Highland Mutual Fund performing well and Highland Merger Mutual Fund doing well as a business compared to the competition. There are so many exceptions to the norm that investors cannot definitively determine what's good or bad unless they analyze Highland Merger's multiple risk-adjusted performance indicators across the competitive landscape. These indicators are quantitative in nature and help investors forecast volatility and risk-adjusted expected returns across various positions.

	Mean Deviation	Jensen Alpha	Sortino Ratio	Treynor Ratio	Expected Shortfall	Potential Upside	Value @Risk	Maximum Drawdown
HHCAX	0.13	(0.01)	0.00	(0.11)	0.00	0.26	(0.32)	0.90
HHCCX	0.14	(0.01)	0.00	(0.13)	0.00	0.28	(0.28)	0.85
HSZYX	0.68	(0.07)	0.00	(0.19)	0.00	1.20	(1.23)	3.94
HSZAX	0.69	(0.07)	0.00	(0.18)	0.00	1.08	(1.26)	3.86
HSZCX	0.73	(0.08)	0.00	(0.18)	0.00	1.31	(1.34)	3.93
HMEAX	0.06	0.02	0.31	1.45	(0.09)	0.10	(0.10)	0.31
HMECX	0.06	0.01	0.27	0.89	(0.09)	0.16	(0.11)	0.32
HMEZX	0.06	0.02	0.34	1.21	(0.09)	0.15	(0.10)	0.30

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