Correlation Between Midcap Fund and Allianzgi Mid-cap

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

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

Diversification Opportunities for Midcap Fund and Allianzgi Mid-cap

0.3

Correlation Coefficient

Midcap Fund  Allianzgi Mid-cap

Weak diversification

The 3 months correlation between Midcap and Allianzgi is 0.3. Overlapping area represents the amount of risk that can be diversified away by holding Midcap Fund Class and Allianzgi Mid Cap Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Allianzgi Mid Cap and Midcap 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 Midcap Fund Class are associated (or correlated) with Allianzgi Mid-cap. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Allianzgi Mid Cap has no effect on the direction of Midcap Fund i.e., Midcap Fund and Allianzgi Mid-cap go up and down completely randomly.

Pair Corralation between Midcap Fund and Allianzgi Mid-cap

Assuming the 90 days horizon Midcap Fund Class is expected to under-perform the Allianzgi Mid-cap. But the mutual fund apears to be less risky and, when comparing its historical volatility, Midcap Fund Class is 1.41 times less risky than Allianzgi Mid-cap. The mutual fund trades about -0.14 of its potential returns per unit of risk. The Allianzgi Mid Cap Fund is currently generating about -0.07 of returns per unit of risk over similar time horizon. If you would invest  700.00  in Allianzgi Mid Cap Fund on August 26, 2025 and sell it today you would lose (36.00) from holding Allianzgi Mid Cap Fund or give up 5.14% of portfolio value over 90 days.

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

Midcap Fund Class  vs.  Allianzgi Mid Cap Fund

Midcap Fund Class

Risk-Adjusted Performance

Weakest

Over the last 90 days Midcap Fund Class has generated negative risk-adjusted returns adding no value to fund investors. In spite of latest weak performance, the Fund's fundamental indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the fund investors.

Allianzgi Mid Cap

Risk-Adjusted Performance

Weakest

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

Pair Trading with Midcap Fund and Allianzgi Mid-cap

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

The idea behind Midcap Fund Class and Allianzgi Mid Cap 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.

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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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.