Correlation Between Cambiar International and Aston/crosswind Small
Can any of the company-specific risk be diversified away by investing in both Cambiar International and Aston/crosswind Small 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 Cambiar International and Aston/crosswind Small into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cambiar International Equity and Astoncrosswind Small Cap, you can compare the effects of market volatilities on Cambiar International and Aston/crosswind Small 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 Cambiar International with a short position of Aston/crosswind Small. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cambiar International and Aston/crosswind Small.
Diversification Opportunities for Cambiar International and Aston/crosswind Small
-0.65 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Cambiar and Aston/crosswind is -0.65. Overlapping area represents the amount of risk that can be diversified away by holding Cambiar International Equity and Astoncrosswind Small Cap in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Astoncrosswind Small Cap and Cambiar International 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 Cambiar International Equity are associated (or correlated) with Aston/crosswind Small. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Astoncrosswind Small Cap has no effect on the direction of Cambiar International i.e., Cambiar International and Aston/crosswind Small go up and down completely randomly.
Pair Corralation between Cambiar International and Aston/crosswind Small
Assuming the 90 days horizon Cambiar International is expected to generate 2.31 times less return on investment than Aston/crosswind Small. But when comparing it to its historical volatility, Cambiar International Equity is 1.42 times less risky than Aston/crosswind Small. It trades about 0.05 of its potential returns per unit of risk. Astoncrosswind Small Cap is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 1,410 in Astoncrosswind Small Cap on September 2, 2024 and sell it today you would earn a total of 460.00 from holding Astoncrosswind Small Cap or generate 32.62% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Cambiar International Equity vs. Astoncrosswind Small Cap
Performance |
| Timeline |
| Cambiar International |
| Astoncrosswind Small Cap |
Cambiar International and Aston/crosswind Small Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cambiar International and Aston/crosswind Small
The main advantage of trading using opposite Cambiar International and Aston/crosswind Small positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cambiar International position performs unexpectedly, Aston/crosswind Small 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 Aston/crosswind Small will offset losses from the drop in Aston/crosswind Small's long position.| Cambiar International vs. Causeway Emerging Markets | Cambiar International vs. Cambiar Small Cap | Cambiar International vs. Pimco Short Term Fund | Cambiar International vs. Cambiar Opportunity Fund |
| Aston/crosswind Small vs. Baron Real Estate | Aston/crosswind Small vs. Eventide Gilead Fund | Aston/crosswind Small vs. Buffalo Emerging Opportunities | Aston/crosswind Small vs. Large Cap Growth |
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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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