Correlation Between Sentinel Small and Mid Cap
Can any of the company-specific risk be diversified away by investing in both Sentinel Small 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 Sentinel Small and Mid Cap into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sentinel Small Pany and Mid Cap Growth, you can compare the effects of market volatilities on Sentinel Small 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 Sentinel Small with a short position of Mid Cap. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sentinel Small and Mid Cap.
Diversification Opportunities for Sentinel Small and Mid Cap
0.78 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Sentinel and Mid is 0.78. Overlapping area represents the amount of risk that can be diversified away by holding Sentinel Small Pany and Mid Cap Growth in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mid Cap Growth and Sentinel Small 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 Sentinel Small Pany 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 Growth has no effect on the direction of Sentinel Small i.e., Sentinel Small and Mid Cap go up and down completely randomly.
Pair Corralation between Sentinel Small and Mid Cap
Assuming the 90 days horizon Sentinel Small Pany is expected to under-perform the Mid Cap. But the mutual fund apears to be less risky and, when comparing its historical volatility, Sentinel Small Pany is 1.06 times less risky than Mid Cap. The mutual fund trades about -0.4 of its potential returns per unit of risk. The Mid Cap Growth is currently generating about -0.24 of returns per unit of risk over similar time horizon. If you would invest 4,074 in Mid Cap Growth on September 25, 2024 and sell it today you would lose (275.00) from holding Mid Cap Growth or give up 6.75% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Significant |
Accuracy | 95.24% |
Values | Daily Returns |
Sentinel Small Pany vs. Mid Cap Growth
Performance |
Timeline |
Sentinel Small Pany |
Mid Cap Growth |
Sentinel Small and Mid Cap Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Sentinel Small and Mid Cap
The main advantage of trading using opposite Sentinel Small and Mid Cap positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sentinel Small 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.Sentinel Small vs. Touchstone Small Cap | Sentinel Small vs. Touchstone Sands Capital | Sentinel Small vs. Mid Cap Growth | Sentinel Small vs. Mid Cap Growth |
Mid Cap vs. Calamos Growth Fund | Mid Cap vs. Mid Cap Growth | Mid Cap vs. Allianzgi Nfj Mid Cap | Mid Cap vs. Davis New York |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
Other Complementary Tools
Volatility Analysis Get historical volatility and risk analysis based on latest market data | |
Cryptocurrency Center Build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency | |
Piotroski F Score Get Piotroski F Score based on the binary analysis strategy of nine different fundamentals | |
My Watchlist Analysis Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like | |
Share Portfolio Track or share privately all of your investments from the convenience of any device |