Correlation Between Gmo Alternative and Wasatch Micro
Can any of the company-specific risk be diversified away by investing in both Gmo Alternative and Wasatch Micro 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 Gmo Alternative and Wasatch Micro into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Gmo Alternative Allocation and Wasatch Micro Cap, you can compare the effects of market volatilities on Gmo Alternative and Wasatch Micro 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 Gmo Alternative with a short position of Wasatch Micro. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gmo Alternative and Wasatch Micro.
Diversification Opportunities for Gmo Alternative and Wasatch Micro
-0.65 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Gmo and Wasatch is -0.65. Overlapping area represents the amount of risk that can be diversified away by holding Gmo Alternative Allocation and Wasatch Micro Cap in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Wasatch Micro Cap and Gmo Alternative 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 Gmo Alternative Allocation are associated (or correlated) with Wasatch Micro. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Wasatch Micro Cap has no effect on the direction of Gmo Alternative i.e., Gmo Alternative and Wasatch Micro go up and down completely randomly.
Pair Corralation between Gmo Alternative and Wasatch Micro
Assuming the 90 days horizon Gmo Alternative Allocation is expected to generate 0.31 times more return on investment than Wasatch Micro. However, Gmo Alternative Allocation is 3.17 times less risky than Wasatch Micro. It trades about 0.24 of its potential returns per unit of risk. Wasatch Micro Cap is currently generating about 0.02 per unit of risk. If you would invest 1,774 in Gmo Alternative Allocation on September 1, 2025 and sell it today you would earn a total of 107.00 from holding Gmo Alternative Allocation or generate 6.03% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Gmo Alternative Allocation vs. Wasatch Micro Cap
Performance |
| Timeline |
| Gmo Alternative Allo |
| Wasatch Micro Cap |
Gmo Alternative and Wasatch Micro Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Gmo Alternative and Wasatch Micro
The main advantage of trading using opposite Gmo Alternative and Wasatch Micro positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gmo Alternative position performs unexpectedly, Wasatch Micro 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 Wasatch Micro will offset losses from the drop in Wasatch Micro's long position.| Gmo Alternative vs. Financial Industries Fund | Gmo Alternative vs. Blackrock Financial Institutions | Gmo Alternative vs. Rmb Mendon Financial | Gmo Alternative vs. John Hancock Financial |
| Wasatch Micro vs. Pender Real Estate | Wasatch Micro vs. Great West Real Estate | Wasatch Micro vs. Deutsche Real Estate | Wasatch Micro vs. Franklin Real Estate |
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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
Other Complementary Tools
| Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas | |
| ETFs Find actively traded Exchange Traded Funds (ETF) from around the world | |
| Portfolio File Import Quickly import all of your third-party portfolios from your local drive in csv format | |
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing | |
| Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk |