Correlation Between Advantage Solutions and GCM Grosvenor
Can any of the company-specific risk be diversified away by investing in both Advantage Solutions and GCM Grosvenor 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 Advantage Solutions and GCM Grosvenor into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Advantage Solutions and GCM Grosvenor, you can compare the effects of market volatilities on Advantage Solutions and GCM Grosvenor 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 Advantage Solutions with a short position of GCM Grosvenor. Check out your portfolio center. Please also check ongoing floating volatility patterns of Advantage Solutions and GCM Grosvenor.
Diversification Opportunities for Advantage Solutions and GCM Grosvenor
-0.35 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Advantage and GCM is -0.35. Overlapping area represents the amount of risk that can be diversified away by holding Advantage Solutions and GCM Grosvenor in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GCM Grosvenor and Advantage Solutions 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 Advantage Solutions are associated (or correlated) with GCM Grosvenor. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GCM Grosvenor has no effect on the direction of Advantage Solutions i.e., Advantage Solutions and GCM Grosvenor go up and down completely randomly.
Pair Corralation between Advantage Solutions and GCM Grosvenor
Assuming the 90 days horizon Advantage Solutions is expected to generate 1.16 times less return on investment than GCM Grosvenor. In addition to that, Advantage Solutions is 1.91 times more volatile than GCM Grosvenor. It trades about 0.12 of its total potential returns per unit of risk. GCM Grosvenor is currently generating about 0.26 per unit of volatility. If you would invest 126.00 in GCM Grosvenor on November 30, 2024 and sell it today you would earn a total of 105.00 from holding GCM Grosvenor or generate 83.33% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 97.56% |
| Values | Daily Returns |
Advantage Solutions vs. GCM Grosvenor
Performance |
| Timeline |
| Advantage Solutions |
| GCM Grosvenor |
Advantage Solutions and GCM Grosvenor Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Advantage Solutions and GCM Grosvenor
The main advantage of trading using opposite Advantage Solutions and GCM Grosvenor positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Advantage Solutions position performs unexpectedly, GCM Grosvenor 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 GCM Grosvenor will offset losses from the drop in GCM Grosvenor's long position.| Advantage Solutions vs. CannBioRx Life Sciences | Advantage Solutions vs. GCM Grosvenor | Advantage Solutions vs. CuriosityStream |
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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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