Correlation Between EMCS and Cambria Micro
Can any of the company-specific risk be diversified away by investing in both EMCS and Cambria Micro 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 EMCS and Cambria Micro into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between EMCS and Cambria Micro And, you can compare the effects of market volatilities on EMCS and Cambria Micro 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 EMCS with a short position of Cambria Micro. Check out your portfolio center. Please also check ongoing floating volatility patterns of EMCS and Cambria Micro.
Diversification Opportunities for EMCS and Cambria Micro
0.15 | Correlation Coefficient |
Average diversification
The 3 months correlation between EMCS and Cambria is 0.15. Overlapping area represents the amount of risk that can be diversified away by holding EMCS and Cambria Micro And in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cambria Micro And and EMCS 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 EMCS are associated (or correlated) with Cambria Micro. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cambria Micro And has no effect on the direction of EMCS i.e., EMCS and Cambria Micro go up and down completely randomly.
Pair Corralation between EMCS and Cambria Micro
Given the investment horizon of 90 days EMCS is expected to generate 0.92 times more return on investment than Cambria Micro. However, EMCS is 1.09 times less risky than Cambria Micro. It trades about 0.08 of its potential returns per unit of risk. Cambria Micro And is currently generating about 0.06 per unit of risk. If you would invest 2,163 in EMCS on August 26, 2024 and sell it today you would earn a total of 504.00 from holding EMCS or generate 23.3% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 83.7% |
| Values | Daily Returns |
EMCS vs. Cambria Micro And
Performance |
| Timeline |
| EMCS |
| Cambria Micro And |
EMCS and Cambria Micro Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with EMCS and Cambria Micro
The main advantage of trading using opposite EMCS and Cambria Micro positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if EMCS position performs unexpectedly, Cambria Micro 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 Micro will offset losses from the drop in Cambria Micro's long position.| EMCS vs. Invesco PureBeta MSCI | EMCS vs. Aquagold International | EMCS vs. Morningstar Unconstrained Allocation | EMCS vs. High Yield Municipal Fund |
| Cambria Micro vs. Invesco Actively Managed | Cambria Micro vs. iShares Trust | Cambria Micro vs. EMCS | Cambria Micro vs. Research Affiliates Deletions |
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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
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