Correlation Between Midas Fund and Horizon Active

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

By analyzing existing cross correlation between Midas Fund Midas and Horizon Active Asset, you can compare the effects of market volatilities on Midas Fund and Horizon Active 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 Midas Fund with a short position of Horizon Active. Check out your portfolio center. Please also check ongoing floating volatility patterns of Midas Fund and Horizon Active.

Diversification Opportunities for Midas Fund and Horizon Active

0.53

Correlation Coefficient

Midas Fund  Horizon Active

Very weak diversification

The 3 months correlation between Midas and Horizon is 0.53. Overlapping area represents the amount of risk that can be diversified away by holding Midas Fund Midas and Horizon Active Asset in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Horizon Active Asset and Midas Fund 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 Midas Fund Midas are associated (or correlated) with Horizon Active. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Horizon Active Asset has no effect on the direction of Midas Fund i.e., Midas Fund and Horizon Active go up and down completely randomly.

Pair Corralation between Midas Fund and Horizon Active

Assuming the 90 days horizon Midas Fund is expected to generate 14.59 times less return on investment than Horizon Active. In addition to that, Midas Fund is 3.25 times more volatile than Horizon Active Asset. It trades about 0.01 of its total potential returns per unit of risk. Horizon Active Asset is currently generating about 0.37 per unit of volatility. If you would invest  1,191  in Horizon Active Asset on April 20, 2025 and sell it today you would earn a total of  213.00  from holding Horizon Active Asset or generate 17.88% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	98.41%
Values	Daily Returns

Midas Fund Midas  vs.  Horizon Active Asset

Midas Fund Midas

Risk-Adjusted Performance

Very Weak

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

Horizon Active Asset

Risk-Adjusted Performance

Strong

Compared to the overall equity markets, risk-adjusted returns on investments in Horizon Active Asset are ranked lower than 29 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak basic indicators, Horizon Active showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Midas Fund and Horizon Active

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

The idea behind Midas Fund Midas and Horizon Active Asset 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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.