Correlation Between Glg Intl and Midcap Fund

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

By analyzing existing cross correlation between Glg Intl Small and Midcap Fund Institutional, you can compare the effects of market volatilities on Glg Intl and Midcap 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 Glg Intl with a short position of Midcap Fund. Check out your portfolio center. Please also check ongoing floating volatility patterns of Glg Intl and Midcap Fund.

Diversification Opportunities for Glg Intl and Midcap Fund

0.47

Correlation Coefficient

Glg Intl  Midcap Fund

Very weak diversification

The 3 months correlation between Glg and Midcap is 0.47. Overlapping area represents the amount of risk that can be diversified away by holding Glg Intl Small and Midcap Fund Institutional in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Midcap Fund Institutional and Glg Intl 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 Glg Intl Small are associated (or correlated) with Midcap Fund. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Midcap Fund Institutional has no effect on the direction of Glg Intl i.e., Glg Intl and Midcap Fund go up and down completely randomly.

Pair Corralation between Glg Intl and Midcap Fund

Assuming the 90 days horizon Glg Intl is expected to generate 1.05 times less return on investment than Midcap Fund. In addition to that, Glg Intl is 1.19 times more volatile than Midcap Fund Institutional. It trades about 0.11 of its total potential returns per unit of risk. Midcap Fund Institutional is currently generating about 0.13 per unit of volatility. If you would invest  4,510  in Midcap Fund Institutional on May 4, 2025 and sell it today you would earn a total of  293.00  from holding Midcap Fund Institutional 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

Glg Intl Small  vs.  Midcap Fund Institutional

Glg Intl Small

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Glg Intl Small are ranked lower than 8 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong forward indicators, Glg Intl is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Midcap Fund Institutional

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Midcap Fund Institutional are ranked lower than 10 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak forward indicators, Midcap Fund may actually be approaching a critical reversion point that can send shares even higher in September 2025.

Pair Trading with Glg Intl and Midcap Fund

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

The idea behind Glg Intl Small and Midcap Fund Institutional 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 Search module to search for actively traded equities including funds and ETFs from over 30 global markets.