Small Cap Correlations

ACVIX Fund  USD 10.33  0.09  0.88%   
The current 90-days correlation between Small Cap Value and Smallcap World Fund is 0.87 (i.e., Very poor diversification). The correlation of Small Cap 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.

Small Cap Correlation With Market

Very poor diversification

The correlation between Small Cap Value and DJI is 0.82 (i.e., Very poor diversification) for selected investment horizon. Overlapping area represents the amount of risk that can be diversified away by holding Small Cap Value and DJI in the same portfolio, assuming nothing else is changed.
  
Check out Trending Equities to better understand how to build diversified portfolios, which includes a position in Small Cap Value. 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 gross domestic product.

Moving together with Small Mutual Fund

  0.9AMDVX Mid Cap ValuePairCorr
  0.9AMEIX Equity GrowthPairCorr
  0.93AMGIX Income GrowthPairCorr
  0.62CDBCX Diversified BondPairCorr
  0.89AMKIX Emerging MarketsPairCorr
  0.9TWADX Value Fund APairCorr
  0.88TWCCX Ultra Fund CPairCorr
  0.84TWCAX Select Fund APairCorr
  0.88TWCIX Select Fund InvestorPairCorr
  0.88TWCGX Growth Fund InvestorPairCorr
  0.65TWAVX Short Term GovernmentPairCorr
  0.96AMVYX Mid Cap ValuePairCorr
  0.96AMVRX Mid Cap ValuePairCorr
  0.9TWBIX Balanced Fund InvestorPairCorr
  0.96AMVGX Mid Cap ValuePairCorr
  0.94TWEAX Equity IncomePairCorr
  0.89TWEIX Equity IncomePairCorr
  0.88TWCUX Ultra Fund InvestorPairCorr
  0.7TWGAX International GrowthPairCorr
  0.88TWGIX Growth Fund IPairCorr
  0.87TWGGX Global GrowthPairCorr
  0.73TWIEX International GrowthPairCorr
  0.86TWHIX Heritage Fund InvestorPairCorr
  0.89TWMIX Emerging MarketsPairCorr
  0.85TWRCX Growth Fund CPairCorr
  0.77TWTCX Intermediate Term TaxPairCorr
  0.79TWTIX Intermediate Term TaxPairCorr
  0.9TWSCX Strategic Allocation:PairCorr
  0.89TWSAX Strategic Allocation:PairCorr
  0.89TWSMX Strategic Allocation:PairCorr
  0.84TWSIX Select Fund IPairCorr
  0.65TWUSX Short Term GovernmentPairCorr
  0.95TWVLX Value Fund InvestorPairCorr
  0.85TWUAX Ultra Fund APairCorr
  0.88TWUIX Ultra Fund IPairCorr
  0.64TWUOX Short Term GovernmentPairCorr
  0.8TWWOX Intermediate Term TaxPairCorr
  0.88NPHIX High Income FundPairCorr

Related Correlations Analysis

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Risk-Adjusted Indicators

There is a big difference between Small Mutual Fund performing well and Small Cap 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 Small Cap'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.