Correlation Between Madison Mid and Doubleline Emerging

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

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

Diversification Opportunities for Madison Mid and Doubleline Emerging

0.56

Correlation Coefficient

Madison Mid  Doubleline Emerging

Very weak diversification

The 3 months correlation between Madison and Doubleline is 0.56. Overlapping area represents the amount of risk that can be diversified away by holding Madison Mid Cap and Doubleline Emerging Markets in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Doubleline Emerging and Madison 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 Madison Mid Cap are associated (or correlated) with Doubleline Emerging. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Doubleline Emerging has no effect on the direction of Madison Mid i.e., Madison Mid and Doubleline Emerging go up and down completely randomly.

Pair Corralation between Madison Mid and Doubleline Emerging

Assuming the 90 days horizon Madison Mid Cap is expected to generate 3.34 times more return on investment than Doubleline Emerging. However, Madison Mid is 3.34 times more volatile than Doubleline Emerging Markets. It trades about 0.09 of its potential returns per unit of risk. Doubleline Emerging Markets is currently generating about 0.29 per unit of risk. If you would invest  1,520  in Madison Mid Cap on July 11, 2025 and sell it today you would earn a total of  182.00  from holding Madison Mid Cap or generate 11.97% return on investment over 90 days.

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

Madison Mid Cap  vs.  Doubleline Emerging Markets

Madison Mid Cap

Risk-Adjusted Performance

Weakest

Compared to the overall equity markets, risk-adjusted returns on investments in Madison Mid Cap are ranked lower than 2 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong forward indicators, Madison Mid is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Doubleline Emerging

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Doubleline Emerging Markets are ranked lower than 15 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong essential indicators, Doubleline Emerging is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Madison Mid and Doubleline Emerging

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

The idea behind Madison Mid Cap and Doubleline Emerging Markets 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 Portfolio Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.