Correlation Between Sp Midcap and Grayscale Funds

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

By analyzing existing cross correlation between Sp Midcap 400 and Grayscale Funds Trust, you can compare the effects of market volatilities on Sp Midcap and Grayscale Funds 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 Sp Midcap with a short position of Grayscale Funds. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sp Midcap and Grayscale Funds.

Diversification Opportunities for Sp Midcap and Grayscale Funds

-0.17

Correlation Coefficient

Sp Midcap  Grayscale Funds

Good diversification

The 3 months correlation between RYAVX and Grayscale is -0.17. Overlapping area represents the amount of risk that can be diversified away by holding Sp Midcap 400 and Grayscale Funds Trust in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Grayscale Funds Trust and Sp Midcap 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 Sp Midcap 400 are associated (or correlated) with Grayscale Funds. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Grayscale Funds Trust has no effect on the direction of Sp Midcap i.e., Sp Midcap and Grayscale Funds go up and down completely randomly.

Pair Corralation between Sp Midcap and Grayscale Funds

Assuming the 90 days horizon Sp Midcap 400 is expected to generate 0.61 times more return on investment than Grayscale Funds. However, Sp Midcap 400 is 1.64 times less risky than Grayscale Funds. It trades about -0.1 of its potential returns per unit of risk. Grayscale Funds Trust is currently generating about -0.18 per unit of risk. If you would invest  7,798  in Sp Midcap 400 on August 2, 2025 and sell it today you would lose (225.00) from holding Sp Midcap 400 or give up 2.89% of portfolio value over 90 days.

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

Sp Midcap 400  vs.  Grayscale Funds Trust

Sp Midcap 400

Risk-Adjusted Performance

Mild

Compared to the overall equity markets, risk-adjusted returns on investments in Sp Midcap 400 are ranked lower than 4 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong basic indicators, Sp Midcap is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Grayscale Funds Trust

Risk-Adjusted Performance

Weakest

Over the last 90 days Grayscale Funds Trust has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fairly strong basic indicators, Grayscale Funds is not utilizing all of its potentials. The current stock price confusion, may contribute to short-horizon losses for the traders.

Pair Trading with Sp Midcap and Grayscale Funds

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

The idea behind Sp Midcap 400 and Grayscale Funds Trust 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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.