Correlation Between Midas Fund and Midas Special

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Can any of the company-specific risk be diversified away by investing in both Midas Fund and Midas Special 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 Midas Fund and Midas Special into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Midas Fund Midas and Midas Special Fund, you can compare the effects of market volatilities on Midas Fund and Midas Special 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 Midas Fund with a short position of Midas Special. Check out your portfolio center. Please also check ongoing floating volatility patterns of Midas Fund and Midas Special.

Diversification Opportunities for Midas Fund and Midas Special

-0.48
  Correlation Coefficient

Very good diversification

The 3 months correlation between Midas and Midas is -0.48. Overlapping area represents the amount of risk that can be diversified away by holding Midas Fund Midas and Midas Special Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Midas Special and Midas 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 Midas Fund Midas are associated (or correlated) with Midas Special. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Midas Special has no effect on the direction of Midas Fund i.e., Midas Fund and Midas Special go up and down completely randomly.

Pair Corralation between Midas Fund and Midas Special

Assuming the 90 days horizon Midas Fund Midas is expected to under-perform the Midas Special. In addition to that, Midas Fund is 2.23 times more volatile than Midas Special Fund. It trades about -0.04 of its total potential returns per unit of risk. Midas Special Fund is currently generating about 0.18 per unit of volatility. If you would invest  3,255  in Midas Special Fund on September 15, 2024 and sell it today you would earn a total of  337.00  from holding Midas Special Fund or generate 10.35% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthVery Weak
Accuracy98.46%
ValuesDaily Returns

Midas Fund Midas  vs.  Midas Special Fund

 Performance 
       Timeline  
Midas Fund Midas 

Risk-Adjusted Performance

0 of 100

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

Risk-Adjusted Performance

14 of 100

 
Weak
 
Strong
Good
Compared to the overall equity markets, risk-adjusted returns on investments in Midas Special Fund are ranked lower than 14 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak technical and fundamental indicators, Midas Special may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Midas Fund and Midas Special Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Midas Fund and Midas Special

The main advantage of trading using opposite Midas Fund and Midas Special positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Midas Fund position performs unexpectedly, Midas Special 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 Midas Special will offset losses from the drop in Midas Special's long position.
The idea behind Midas Fund Midas and Midas Special Fund 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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.

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