Correlation Between Shelton Green and Sp Midcap

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

By analyzing existing cross correlation between Shelton Green Alpha and Sp Midcap Index, you can compare the effects of market volatilities on Shelton Green and Sp Midcap 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 Shelton Green with a short position of Sp Midcap. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shelton Green and Sp Midcap.

Diversification Opportunities for Shelton Green and Sp Midcap

0.94

Correlation Coefficient

Shelton Green  Sp Midcap

Almost no diversification

The 3 months correlation between Shelton and SPMIX is 0.94. Overlapping area represents the amount of risk that can be diversified away by holding Shelton Green Alpha and Sp Midcap Index in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sp Midcap Index and Shelton Green 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 Shelton Green Alpha are associated (or correlated) with Sp Midcap. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sp Midcap Index has no effect on the direction of Shelton Green i.e., Shelton Green and Sp Midcap go up and down completely randomly.

Pair Corralation between Shelton Green and Sp Midcap

Assuming the 90 days horizon Shelton Green Alpha is expected to generate 0.97 times more return on investment than Sp Midcap. However, Shelton Green Alpha is 1.03 times less risky than Sp Midcap. It trades about 0.23 of its potential returns per unit of risk. Sp Midcap Index is currently generating about 0.13 per unit of risk. If you would invest  2,910  in Shelton Green Alpha on May 4, 2025 and sell it today you would earn a total of  431.00  from holding Shelton Green Alpha or generate 14.81% return on investment over 90 days.

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

Shelton Green Alpha  vs.  Sp Midcap Index

Shelton Green Alpha

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Shelton Green Alpha are ranked lower than 18 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak basic indicators, Shelton Green showed solid returns over the last few months and may actually be approaching a breakup point.

Sp Midcap Index

Risk-Adjusted Performance

OK

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

Pair Trading with Shelton Green and Sp Midcap

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

The idea behind Shelton Green Alpha and Sp Midcap Index 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 Equity Valuation module to check real value of public entities based on technical and fundamental data.