Correlation Between Cambiar Small and Tcw Emerging
Can any of the company-specific risk be diversified away by investing in both Cambiar Small and Tcw Emerging 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 Small and Tcw Emerging into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cambiar Small Cap and Tcw Emerging Markets, you can compare the effects of market volatilities on Cambiar Small and Tcw Emerging 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 Small with a short position of Tcw Emerging. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cambiar Small and Tcw Emerging.
Diversification Opportunities for Cambiar Small and Tcw Emerging
-0.14 | Correlation Coefficient |
Good diversification
The 3 months correlation between Cambiar and Tcw is -0.14. Overlapping area represents the amount of risk that can be diversified away by holding Cambiar Small Cap and Tcw Emerging Markets in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tcw Emerging Markets and Cambiar Small 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 Small Cap are associated (or correlated) with Tcw Emerging. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tcw Emerging Markets has no effect on the direction of Cambiar Small i.e., Cambiar Small and Tcw Emerging go up and down completely randomly.
Pair Corralation between Cambiar Small and Tcw Emerging
Assuming the 90 days horizon Cambiar Small Cap is expected to generate 3.67 times more return on investment than Tcw Emerging. However, Cambiar Small is 3.67 times more volatile than Tcw Emerging Markets. It trades about 0.3 of its potential returns per unit of risk. Tcw Emerging Markets is currently generating about 0.1 per unit of risk. If you would invest 1,660 in Cambiar Small Cap on September 1, 2024 and sell it today you would earn a total of 157.00 from holding Cambiar Small Cap or generate 9.46% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.45% |
| Values | Daily Returns |
Cambiar Small Cap vs. Tcw Emerging Markets
Performance |
| Timeline |
| Cambiar Small Cap |
| Tcw Emerging Markets |
Cambiar Small and Tcw Emerging Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cambiar Small and Tcw Emerging
The main advantage of trading using opposite Cambiar Small and Tcw Emerging positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cambiar Small position performs unexpectedly, Tcw Emerging 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 Tcw Emerging will offset losses from the drop in Tcw Emerging's long position.| Cambiar Small vs. Jpmorgan Dynamic Small | Cambiar Small vs. Cambiar Opportunity Fund | Cambiar Small vs. Virtus Emerging Markets | Cambiar Small vs. Cambiar International Equity |
| Tcw Emerging vs. Tcw Total Return | Tcw Emerging vs. Metropolitan West High | Tcw Emerging vs. Doubleline Total Return | Tcw Emerging vs. Tcw Emerging Markets |
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 Portfolio Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
Other Complementary Tools
| Fundamentals Comparison Compare fundamentals across multiple equities to find investing opportunities | |
| Money Flow Index Determine momentum by analyzing Money Flow Index and other technical indicators | |
| Money Managers Screen money managers from public funds and ETFs managed around the world | |
| Bonds Directory Find actively traded corporate debentures issued by US companies | |
| Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum |