Correlation Between Cambria Value and Horizon Nasdaq
Can any of the company-specific risk be diversified away by investing in both Cambria Value and Horizon Nasdaq 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 Cambria Value and Horizon Nasdaq into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cambria Value and and Horizon Nasdaq 100 Defined, you can compare the effects of market volatilities on Cambria Value and Horizon Nasdaq 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 Cambria Value with a short position of Horizon Nasdaq. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cambria Value and Horizon Nasdaq.
Diversification Opportunities for Cambria Value and Horizon Nasdaq
0.64 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Cambria and Horizon is 0.64. Overlapping area represents the amount of risk that can be diversified away by holding Cambria Value and and Horizon Nasdaq 100 Defined in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Horizon Nasdaq 100 and Cambria Value 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 Cambria Value and are associated (or correlated) with Horizon Nasdaq. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Horizon Nasdaq 100 has no effect on the direction of Cambria Value i.e., Cambria Value and Horizon Nasdaq go up and down completely randomly.
Pair Corralation between Cambria Value and Horizon Nasdaq
Given the investment horizon of 90 days Cambria Value and is expected to under-perform the Horizon Nasdaq. But the etf apears to be less risky and, when comparing its historical volatility, Cambria Value and is 1.32 times less risky than Horizon Nasdaq. The etf trades about -0.05 of its potential returns per unit of risk. The Horizon Nasdaq 100 Defined is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 2,700 in Horizon Nasdaq 100 Defined on August 18, 2025 and sell it today you would earn a total of 13.00 from holding Horizon Nasdaq 100 Defined or generate 0.48% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Cambria Value and vs. Horizon Nasdaq 100 Defined
Performance |
| Timeline |
| Cambria Value |
| Horizon Nasdaq 100 |
Cambria Value and Horizon Nasdaq Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cambria Value and Horizon Nasdaq
The main advantage of trading using opposite Cambria Value and Horizon Nasdaq positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cambria Value position performs unexpectedly, Horizon Nasdaq 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 Horizon Nasdaq will offset losses from the drop in Horizon Nasdaq's long position.| Cambria Value vs. KraneShares MSCI Emerging | Cambria Value vs. Xtrackers MSCI Eurozone | Cambria Value vs. abrdn Focused Small | Cambria Value vs. InfraCap Equity Income |
| Horizon Nasdaq vs. ProShares SP Kensho | Horizon Nasdaq vs. USCF Sustainable Battery | Horizon Nasdaq vs. ProShares Smart Materials | Horizon Nasdaq vs. Pacer BlueStar Engineering |
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 Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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