Correlation Between Mid Cap and Touchstone Focused

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

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

Diversification Opportunities for Mid Cap and Touchstone Focused

0.0

Correlation Coefficient

Mid Cap  Touchstone Focused

Pay attention - limited upside

The 3 months correlation between Mid and Touchstone is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Mid Cap Growth and Touchstone Focused Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Touchstone Focused and Mid Cap 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 Mid Cap Growth are associated (or correlated) with Touchstone Focused. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Touchstone Focused has no effect on the direction of Mid Cap i.e., Mid Cap and Touchstone Focused go up and down completely randomly.

Pair Corralation between Mid Cap and Touchstone Focused

If you would invest  7,500  in Touchstone Focused Fund on May 24, 2025 and sell it today you would earn a total of  634.00  from holding Touchstone Focused Fund or generate 8.45% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

Mid Cap Growth  vs.  Touchstone Focused Fund

Mid Cap Growth

Risk-Adjusted Performance

Fair

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

Touchstone Focused

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Touchstone Focused Fund are ranked lower than 17 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak forward indicators, Touchstone Focused may actually be approaching a critical reversion point that can send shares even higher in September 2025.

Pair Trading with Mid Cap and Touchstone Focused

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

The idea behind Mid Cap Growth and Touchstone Focused 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.

Check out your portfolio center.

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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.