Correlation Between Great-west Securefoundation and Mid Cap

Can any of the company-specific risk be diversified away by investing in both Great-west Securefoundation and Mid Cap 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 Great-west Securefoundation and Mid Cap into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Great West Securefoundation Balanced and Mid Cap Value Profund, you can compare the effects of market volatilities on Great-west Securefoundation and Mid Cap 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 Great-west Securefoundation with a short position of Mid Cap. Check out your portfolio center. Please also check ongoing floating volatility patterns of Great-west Securefoundation and Mid Cap.

Diversification Opportunities for Great-west Securefoundation and Mid Cap

0.55

Correlation Coefficient

Great-west Securefoundation  Mid Cap

Very weak diversification

The 3 months correlation between Great-west and Mid is 0.55. Overlapping area represents the amount of risk that can be diversified away by holding Great West Securefoundation Ba and Mid Cap Value Profund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mid Cap Value and Great-west Securefoundation 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 Great West Securefoundation Balanced are associated (or correlated) with Mid Cap. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mid Cap Value has no effect on the direction of Great-west Securefoundation i.e., Great-west Securefoundation and Mid Cap go up and down completely randomly.

Pair Corralation between Great-west Securefoundation and Mid Cap

Assuming the 90 days horizon Great West Securefoundation Balanced is expected to under-perform the Mid Cap. In addition to that, Great-west Securefoundation is 1.49 times more volatile than Mid Cap Value Profund. It trades about -0.29 of its total potential returns per unit of risk. Mid Cap Value Profund is currently generating about -0.24 per unit of volatility. If you would invest  9,378  in Mid Cap Value Profund on October 9, 2024 and sell it today you would lose (464.00) from holding Mid Cap Value Profund or give up 4.95% of portfolio value over 90 days.

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

Great West Securefoundation Ba  vs.  Mid Cap Value Profund

Great-west Securefoundation

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Great West Securefoundation Balanced has generated negative risk-adjusted returns adding no value to fund investors. In spite of latest weak performance, the Fund's forward-looking indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the fund investors.

Mid Cap Value

Risk-Adjusted Performance

2 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Mid Cap Value Profund are ranked lower than 2 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong basic indicators, Mid Cap is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Great-west Securefoundation and Mid Cap

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

The idea behind Great West Securefoundation Balanced and Mid Cap Value Profund 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.

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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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.