Correlation Between Perkins Mid and Perkins Small

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

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

Diversification Opportunities for Perkins Mid and Perkins Small

0.5

Correlation Coefficient

Perkins Mid  Perkins Small

Very weak diversification

The 3 months correlation between Perkins and Perkins is 0.5. Overlapping area represents the amount of risk that can be diversified away by holding Perkins Mid Cap and Perkins Small Cap in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Perkins Small Cap and Perkins Mid 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 Perkins Mid Cap are associated (or correlated) with Perkins Small. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Perkins Small Cap has no effect on the direction of Perkins Mid i.e., Perkins Mid and Perkins Small go up and down completely randomly.

Pair Corralation between Perkins Mid and Perkins Small

Assuming the 90 days horizon Perkins Mid Cap is expected to under-perform the Perkins Small. But the mutual fund apears to be less risky and, when comparing its historical volatility, Perkins Mid Cap is 1.31 times less risky than Perkins Small. The mutual fund trades about 0.0 of its potential returns per unit of risk. The Perkins Small Cap is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest  2,430  in Perkins Small Cap on August 13, 2025 and sell it today you would earn a total of  69.00  from holding Perkins Small Cap or generate 2.84% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	98.44%
Values	Daily Returns

Perkins Mid Cap  vs.  Perkins Small Cap

Perkins Mid Cap

Risk-Adjusted Performance

Weakest

Over the last 90 days Perkins Mid Cap has generated negative risk-adjusted returns adding no value to fund investors. In spite of fairly strong basic indicators, Perkins Mid is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Perkins Small Cap

Risk-Adjusted Performance

Soft

Compared to the overall equity markets, risk-adjusted returns on investments in Perkins Small Cap are ranked lower than 3 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong basic indicators, Perkins Small is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Perkins Mid and Perkins Small

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

The idea behind Perkins Mid Cap and Perkins Small Cap 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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.