Correlation Between Quantitative and Gmo Global
Can any of the company-specific risk be diversified away by investing in both Quantitative and Gmo Global 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 Quantitative and Gmo Global into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Quantitative Longshort Equity and Gmo Global Equity, you can compare the effects of market volatilities on Quantitative and Gmo Global 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 Quantitative with a short position of Gmo Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of Quantitative and Gmo Global.
Diversification Opportunities for Quantitative and Gmo Global
0.88 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Quantitative and Gmo is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding Quantitative Longshort Equity and Gmo Global Equity in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gmo Global Equity and Quantitative 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 Quantitative Longshort Equity are associated (or correlated) with Gmo Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gmo Global Equity has no effect on the direction of Quantitative i.e., Quantitative and Gmo Global go up and down completely randomly.
Pair Corralation between Quantitative and Gmo Global
Assuming the 90 days horizon Quantitative is expected to generate 1.65 times less return on investment than Gmo Global. But when comparing it to its historical volatility, Quantitative Longshort Equity is 2.03 times less risky than Gmo Global. It trades about 0.09 of its potential returns per unit of risk. Gmo Global Equity is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 2,948 in Gmo Global Equity on March 15, 2025 and sell it today you would earn a total of 172.00 from holding Gmo Global Equity or generate 5.83% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Quantitative Longshort Equity vs. Gmo Global Equity
Performance |
| Timeline |
| Quantitative Longshort |
| Gmo Global Equity |
Quantitative and Gmo Global Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Quantitative and Gmo Global
The main advantage of trading using opposite Quantitative and Gmo Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Quantitative position performs unexpectedly, Gmo Global 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 Gmo Global will offset losses from the drop in Gmo Global's long position.| Quantitative vs. Profunds Large Cap Growth | Quantitative vs. Bmo Large Cap Growth | Quantitative vs. M Large Cap | Quantitative vs. Qs Large Cap |
| Gmo Global vs. Rmb Mendon Financial | Gmo Global vs. John Hancock Financial | Gmo Global vs. Mesirow Financial Small | Gmo Global vs. Angel Oak Financial |
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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
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