Correlation Between Delaware Smid and Delaware Select

Can any of the company-specific risk be diversified away by investing in both Delaware Smid and Delaware Select 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 Delaware Smid and Delaware Select into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Delaware Smid Cap and Delaware Select Growth, you can compare the effects of market volatilities on Delaware Smid and Delaware Select 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 Delaware Smid with a short position of Delaware Select. Check out your portfolio center. Please also check ongoing floating volatility patterns of Delaware Smid and Delaware Select.

Diversification Opportunities for Delaware Smid and Delaware Select

0.25

Correlation Coefficient

Delaware Smid  Delaware Select

Modest diversification

The 3 months correlation between Delaware and Delaware is 0.25. Overlapping area represents the amount of risk that can be diversified away by holding Delaware Smid Cap and Delaware Select Growth in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Delaware Select Growth and Delaware Smid 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 Delaware Smid Cap are associated (or correlated) with Delaware Select. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Delaware Select Growth has no effect on the direction of Delaware Smid i.e., Delaware Smid and Delaware Select go up and down completely randomly.

Pair Corralation between Delaware Smid and Delaware Select

If you would invest  2,739  in Delaware Select Growth on September 15, 2024 and sell it today you would earn a total of  0.00  from holding Delaware Select Growth or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	100.0%
Values	Daily Returns

Delaware Smid Cap  vs.  Delaware Select Growth

Delaware Smid Cap

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Delaware Smid Cap has generated negative risk-adjusted returns adding no value to fund investors. In spite of fairly strong forward indicators, Delaware Smid is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Delaware Select Growth

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Delaware Select Growth has generated negative risk-adjusted returns adding no value to fund investors. In spite of fairly strong basic indicators, Delaware Select is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Delaware Smid and Delaware Select

The main advantage of trading using opposite Delaware Smid and Delaware Select positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Delaware Smid position performs unexpectedly, Delaware Select 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 Delaware Select will offset losses from the drop in Delaware Select's long position.

The idea behind Delaware Smid Cap and Delaware Select Growth pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..