Correlation Between Cornerstone Strategic and Clough Global
Can any of the company-specific risk be diversified away by investing in both Cornerstone Strategic and Clough Global 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 Cornerstone Strategic and Clough Global into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cornerstone Strategic Return and Clough Global Ef, you can compare the effects of market volatilities on Cornerstone Strategic and Clough Global 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 Cornerstone Strategic with a short position of Clough Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cornerstone Strategic and Clough Global.
Diversification Opportunities for Cornerstone Strategic and Clough Global
0.64 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Cornerstone and Clough is 0.64. Overlapping area represents the amount of risk that can be diversified away by holding Cornerstone Strategic Return and Clough Global Ef in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Clough Global Ef and Cornerstone Strategic 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 Cornerstone Strategic Return are associated (or correlated) with Clough Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Clough Global Ef has no effect on the direction of Cornerstone Strategic i.e., Cornerstone Strategic and Clough Global go up and down completely randomly.
Pair Corralation between Cornerstone Strategic and Clough Global
Considering the 90-day investment horizon Cornerstone Strategic Return is expected to generate 1.33 times more return on investment than Clough Global. However, Cornerstone Strategic is 1.33 times more volatile than Clough Global Ef. It trades about 0.51 of its potential returns per unit of risk. Clough Global Ef is currently generating about 0.15 per unit of risk. If you would invest 832.00 in Cornerstone Strategic Return on September 1, 2024 and sell it today you would earn a total of 98.00 from holding Cornerstone Strategic Return or generate 11.78% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Cornerstone Strategic Return vs. Clough Global Ef
Performance |
| Timeline |
| Cornerstone Strategic |
| Clough Global Ef |
Cornerstone Strategic and Clough Global Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cornerstone Strategic and Clough Global
The main advantage of trading using opposite Cornerstone Strategic and Clough Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cornerstone Strategic position performs unexpectedly, Clough Global 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 Clough Global will offset losses from the drop in Clough Global's long position.The idea behind Cornerstone Strategic Return and Clough Global Ef pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
| Clough Global vs. Allianzgi Convertible Income | Clough Global vs. MFS Investment Grade | Clough Global vs. Eaton Vance Senior | Clough Global vs. Stone Harbor Emerging |
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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.
Other Complementary Tools
| Portfolio Rebalancing Analyze risk-adjusted returns against different time horizons to find asset-allocation targets | |
| Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk | |
| Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas | |
| Portfolio Dashboard Portfolio dashboard that provides centralized access to all your investments | |
| Crypto Correlations Use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins |