Correlation Between Seafarer Overseas and Gmo Emerging
Can any of the company-specific risk be diversified away by investing in both Seafarer Overseas and Gmo Emerging 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 Seafarer Overseas and Gmo Emerging into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Seafarer Overseas Growth and Gmo Emerging Markets, you can compare the effects of market volatilities on Seafarer Overseas and Gmo Emerging 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 Seafarer Overseas with a short position of Gmo Emerging. Check out your portfolio center. Please also check ongoing floating volatility patterns of Seafarer Overseas and Gmo Emerging.
Diversification Opportunities for Seafarer Overseas and Gmo Emerging
0.96 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Seafarer and Gmo is 0.96. Overlapping area represents the amount of risk that can be diversified away by holding Seafarer Overseas Growth and Gmo Emerging Markets in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gmo Emerging Markets and Seafarer Overseas 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 Seafarer Overseas Growth are associated (or correlated) with Gmo Emerging. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gmo Emerging Markets has no effect on the direction of Seafarer Overseas i.e., Seafarer Overseas and Gmo Emerging go up and down completely randomly.
Pair Corralation between Seafarer Overseas and Gmo Emerging
Assuming the 90 days horizon Seafarer Overseas is expected to generate 1.24 times less return on investment than Gmo Emerging. But when comparing it to its historical volatility, Seafarer Overseas Growth is 1.21 times less risky than Gmo Emerging. It trades about 0.17 of its potential returns per unit of risk. Gmo Emerging Markets is currently generating about 0.17 of returns per unit of risk over similar time horizon. If you would invest 1,157 in Gmo Emerging Markets on March 28, 2025 and sell it today you would earn a total of 153.00 from holding Gmo Emerging Markets or generate 13.22% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Seafarer Overseas Growth vs. Gmo Emerging Markets
Performance |
| Timeline |
| Seafarer Overseas Growth |
| Gmo Emerging Markets |
Seafarer Overseas and Gmo Emerging Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Seafarer Overseas and Gmo Emerging
The main advantage of trading using opposite Seafarer Overseas and Gmo Emerging positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Seafarer Overseas position performs unexpectedly, Gmo Emerging 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 Emerging will offset losses from the drop in Gmo Emerging's long position.| Seafarer Overseas vs. Auer Growth Fund | Seafarer Overseas vs. Rbb Fund | Seafarer Overseas vs. Delaware Limited Term Diversified | Seafarer Overseas vs. Principal Lifetime Hybrid |
| Gmo Emerging vs. Fidelity Sai Convertible | Gmo Emerging vs. Lord Abbett Convertible | Gmo Emerging vs. Allianzgi Convertible Income | Gmo Emerging vs. Putnam Convertible Securities |
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 Portfolio Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
Other Complementary Tools
| Portfolio Volatility Check portfolio volatility and analyze historical return density to properly model market risk | |
| Watchlist Optimization Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm | |
| Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum | |
| ETFs Find actively traded Exchange Traded Funds (ETF) from around the world | |
| Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios |