Correlation Between Columbia Select and Munivest Fund

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

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

Diversification Opportunities for Columbia Select and Munivest Fund

0.43

Correlation Coefficient

Columbia Select  Munivest Fund

Very weak diversification

The 3 months correlation between Columbia and Munivest is 0.43. Overlapping area represents the amount of risk that can be diversified away by holding Columbia Select Smaller Cap and Munivest Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Munivest Fund and Columbia Select 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 Columbia Select Smaller Cap are associated (or correlated) with Munivest Fund. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Munivest Fund has no effect on the direction of Columbia Select i.e., Columbia Select and Munivest Fund go up and down completely randomly.

Pair Corralation between Columbia Select and Munivest Fund

Assuming the 90 days horizon Columbia Select Smaller Cap is expected to generate 2.14 times more return on investment than Munivest Fund. However, Columbia Select is 2.14 times more volatile than Munivest Fund. It trades about 0.09 of its potential returns per unit of risk. Munivest Fund is currently generating about 0.18 per unit of risk. If you would invest  2,108  in Columbia Select Smaller Cap on August 6, 2025 and sell it today you would earn a total of  137.00  from holding Columbia Select Smaller Cap or generate 6.5% return on investment over 90 days.

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

Columbia Select Smaller Cap  vs.  Munivest Fund

Columbia Select Smaller

Risk-Adjusted Performance

Fair

Compared to the overall equity markets, risk-adjusted returns on investments in Columbia Select Smaller Cap are ranked lower than 7 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak basic indicators, Columbia Select may actually be approaching a critical reversion point that can send shares even higher in December 2025.

Munivest Fund

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Munivest Fund are ranked lower than 13 (%) of all funds and portfolios of funds over the last 90 days. Despite nearly stable basic indicators, Munivest Fund is not utilizing all of its potentials. The recent stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with Columbia Select and Munivest Fund

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

The idea behind Columbia Select Smaller Cap and Munivest 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.

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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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.