Correlation Between Intech Us and Gmo Quality

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

By analyzing existing cross correlation between Intech Managed Volatility and Gmo Quality Fund, you can compare the effects of market volatilities on Intech Us and Gmo Quality 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 Intech Us with a short position of Gmo Quality. Check out your portfolio center. Please also check ongoing floating volatility patterns of Intech Us and Gmo Quality.

Diversification Opportunities for Intech Us and Gmo Quality

0.91

Correlation Coefficient

Intech Us  Gmo Quality

Almost no diversification

The 3 months correlation between Intech and Gmo is 0.91. Overlapping area represents the amount of risk that can be diversified away by holding Intech Managed Volatility and Gmo Quality Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gmo Quality Fund and Intech Us 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 Intech Managed Volatility are associated (or correlated) with Gmo Quality. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gmo Quality Fund has no effect on the direction of Intech Us i.e., Intech Us and Gmo Quality go up and down completely randomly.

Pair Corralation between Intech Us and Gmo Quality

Assuming the 90 days horizon Intech Us is expected to generate 1.71 times less return on investment than Gmo Quality. But when comparing it to its historical volatility, Intech Managed Volatility is 1.04 times less risky than Gmo Quality. It trades about 0.12 of its potential returns per unit of risk. Gmo Quality Fund is currently generating about 0.2 of returns per unit of risk over similar time horizon. If you would invest  3,417  in Gmo Quality Fund on July 27, 2025 and sell it today you would earn a total of  292.00  from holding Gmo Quality Fund or generate 8.55% return on investment over 90 days.

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

Intech Managed Volatility  vs.  Gmo Quality Fund

Intech Managed Volatility

Risk-Adjusted Performance

Fair

Compared to the overall equity markets, risk-adjusted returns on investments in Intech Managed Volatility are ranked lower than 9 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong fundamental indicators, Intech Us is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Gmo Quality Fund

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Gmo Quality Fund are ranked lower than 15 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak basic indicators, Gmo Quality may actually be approaching a critical reversion point that can send shares even higher in November 2025.

Pair Trading with Intech Us and Gmo Quality

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

The idea behind Intech Managed Volatility and Gmo Quality 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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.