Correlation Between Gladstone Investment and CDL INVESTMENT
Can any of the company-specific risk be diversified away by investing in both Gladstone Investment and CDL INVESTMENT 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 Gladstone Investment and CDL INVESTMENT into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Gladstone Investment and CDL INVESTMENT, you can compare the effects of market volatilities on Gladstone Investment and CDL INVESTMENT 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 Gladstone Investment with a short position of CDL INVESTMENT. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gladstone Investment and CDL INVESTMENT.
Diversification Opportunities for Gladstone Investment and CDL INVESTMENT
-0.41 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Gladstone and CDL is -0.41. Overlapping area represents the amount of risk that can be diversified away by holding Gladstone Investment and CDL INVESTMENT in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CDL INVESTMENT and Gladstone Investment 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 Gladstone Investment are associated (or correlated) with CDL INVESTMENT. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CDL INVESTMENT has no effect on the direction of Gladstone Investment i.e., Gladstone Investment and CDL INVESTMENT go up and down completely randomly.
Pair Corralation between Gladstone Investment and CDL INVESTMENT
Assuming the 90 days horizon Gladstone Investment is expected to generate 0.96 times more return on investment than CDL INVESTMENT. However, Gladstone Investment is 1.04 times less risky than CDL INVESTMENT. It trades about 0.15 of its potential returns per unit of risk. CDL INVESTMENT is currently generating about 0.0 per unit of risk. If you would invest 1,053 in Gladstone Investment on August 28, 2024 and sell it today you would earn a total of 217.00 from holding Gladstone Investment or generate 20.61% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Gladstone Investment vs. CDL INVESTMENT
Performance |
| Timeline |
| Gladstone Investment |
| CDL INVESTMENT |
Gladstone Investment and CDL INVESTMENT Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Gladstone Investment and CDL INVESTMENT
The main advantage of trading using opposite Gladstone Investment and CDL INVESTMENT positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gladstone Investment position performs unexpectedly, CDL INVESTMENT 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 CDL INVESTMENT will offset losses from the drop in CDL INVESTMENT's long position.| Gladstone Investment vs. Lyxor 1 | Gladstone Investment vs. Xtrackers LevDAX | Gladstone Investment vs. Xtrackers ShortDAX |
| CDL INVESTMENT vs. Sabra Health Care | CDL INVESTMENT vs. Zijin Mining Group | CDL INVESTMENT vs. CVS Health | CDL INVESTMENT vs. EPSILON HEALTHCARE LTD |
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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
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