Correlation Between Advent Claymore and Gmo Alternative
Can any of the company-specific risk be diversified away by investing in both Advent Claymore and Gmo Alternative 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 Advent Claymore and Gmo Alternative into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Advent Claymore Convertible and Gmo Alternative Allocation, you can compare the effects of market volatilities on Advent Claymore and Gmo Alternative 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 Advent Claymore with a short position of Gmo Alternative. Check out your portfolio center. Please also check ongoing floating volatility patterns of Advent Claymore and Gmo Alternative.
Diversification Opportunities for Advent Claymore and Gmo Alternative
-0.74 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Advent and Gmo is -0.74. Overlapping area represents the amount of risk that can be diversified away by holding Advent Claymore Convertible and Gmo Alternative Allocation in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gmo Alternative Allo and Advent Claymore 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 Advent Claymore Convertible are associated (or correlated) with Gmo Alternative. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gmo Alternative Allo has no effect on the direction of Advent Claymore i.e., Advent Claymore and Gmo Alternative go up and down completely randomly.
Pair Corralation between Advent Claymore and Gmo Alternative
Considering the 90-day investment horizon Advent Claymore Convertible is expected to generate 3.33 times more return on investment than Gmo Alternative. However, Advent Claymore is 3.33 times more volatile than Gmo Alternative Allocation. It trades about 0.09 of its potential returns per unit of risk. Gmo Alternative Allocation is currently generating about 0.01 per unit of risk. If you would invest 820.00 in Advent Claymore Convertible on September 14, 2024 and sell it today you would earn a total of 428.00 from holding Advent Claymore Convertible or generate 52.2% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Advent Claymore Convertible vs. Gmo Alternative Allocation
Performance |
| Timeline |
| Advent Claymore Conv |
| Gmo Alternative Allo |
Advent Claymore and Gmo Alternative Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Advent Claymore and Gmo Alternative
The main advantage of trading using opposite Advent Claymore and Gmo Alternative positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Advent Claymore position performs unexpectedly, Gmo Alternative 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 Alternative will offset losses from the drop in Gmo Alternative's long position.| Advent Claymore vs. Nuveen Global High | Advent Claymore vs. Blackstone Gso Strategic | Advent Claymore vs. Thornburg Income Builder | Advent Claymore vs. Western Asset Diversified |
| Gmo Alternative vs. Pace International Emerging | Gmo Alternative vs. Ep Emerging Markets | Gmo Alternative vs. Transamerica Emerging Markets | Gmo Alternative vs. Nasdaq 100 2x Strategy |
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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
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