Correlation Between FT Vest and Cambria
Can any of the company-specific risk be diversified away by investing in both FT Vest and Cambria 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 FT Vest and Cambria into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between FT Vest Equity and Cambria, you can compare the effects of market volatilities on FT Vest and Cambria 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 FT Vest with a short position of Cambria. Check out your portfolio center. Please also check ongoing floating volatility patterns of FT Vest and Cambria.
Diversification Opportunities for FT Vest and Cambria
Very good diversification
The 3 months correlation between DHDG and Cambria is -0.3. Overlapping area represents the amount of risk that can be diversified away by holding FT Vest Equity and Cambria in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cambria and FT Vest 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 FT Vest Equity are associated (or correlated) with Cambria. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cambria has no effect on the direction of FT Vest i.e., FT Vest and Cambria go up and down completely randomly.
Pair Corralation between FT Vest and Cambria
Given the investment horizon of 90 days FT Vest Equity is expected to generate 0.79 times more return on investment than Cambria. However, FT Vest Equity is 1.27 times less risky than Cambria. It trades about 0.08 of its potential returns per unit of risk. Cambria is currently generating about -0.05 per unit of risk. If you would invest 3,038 in FT Vest Equity on October 24, 2024 and sell it today you would earn a total of 77.60 from holding FT Vest Equity or generate 2.55% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 53.39% |
| Values | Daily Returns |
FT Vest Equity vs. Cambria
Performance |
| Timeline |
| FT Vest Equity |
| Cambria |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
FT Vest and Cambria Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with FT Vest and Cambria
The main advantage of trading using opposite FT Vest and Cambria positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if FT Vest position performs unexpectedly, Cambria 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 Cambria will offset losses from the drop in Cambria's long position.| FT Vest vs. Northern Lights | FT Vest vs. Dimensional International High | FT Vest vs. JPMorgan Fundamental Data | FT Vest vs. Matthews China Discovery |
| Cambria vs. Cambria Global Tail | Cambria vs. FT Vest Equity | Cambria vs. Zillow Group Class | Cambria vs. Northern Lights |
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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
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