Correlation Between Ep Emerging and Cliffwater Corporate

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Can any of the company-specific risk be diversified away by investing in both Ep Emerging and Cliffwater Corporate 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 Ep Emerging and Cliffwater Corporate into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ep Emerging Markets and Cliffwater Corporate Lending, you can compare the effects of market volatilities on Ep Emerging and Cliffwater Corporate 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 Ep Emerging with a short position of Cliffwater Corporate. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ep Emerging and Cliffwater Corporate.

Diversification Opportunities for Ep Emerging and Cliffwater Corporate

-0.29
  Correlation Coefficient

Very good diversification

The 3 months correlation between EPEIX and Cliffwater is -0.29. Overlapping area represents the amount of risk that can be diversified away by holding Ep Emerging Markets and Cliffwater Corporate Lending in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cliffwater Corporate and Ep Emerging 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 Ep Emerging Markets are associated (or correlated) with Cliffwater Corporate. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cliffwater Corporate has no effect on the direction of Ep Emerging i.e., Ep Emerging and Cliffwater Corporate go up and down completely randomly.

Pair Corralation between Ep Emerging and Cliffwater Corporate

Assuming the 90 days horizon Ep Emerging is expected to generate 2.44 times less return on investment than Cliffwater Corporate. In addition to that, Ep Emerging is 21.96 times more volatile than Cliffwater Corporate Lending. It trades about 0.02 of its total potential returns per unit of risk. Cliffwater Corporate Lending is currently generating about 0.82 per unit of volatility. If you would invest  1,058  in Cliffwater Corporate Lending on September 12, 2024 and sell it today you would earn a total of  28.00  from holding Cliffwater Corporate Lending or generate 2.65% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthInsignificant
Accuracy98.44%
ValuesDaily Returns

Ep Emerging Markets  vs.  Cliffwater Corporate Lending

 Performance 
       Timeline  
Ep Emerging Markets 

Risk-Adjusted Performance

1 of 100

 
Weak
 
Strong
Weak
Compared to the overall equity markets, risk-adjusted returns on investments in Ep Emerging Markets are ranked lower than 1 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong forward indicators, Ep Emerging is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.
Cliffwater Corporate 

Risk-Adjusted Performance

64 of 100

 
Weak
 
Strong
Market Crasher
Compared to the overall equity markets, risk-adjusted returns on investments in Cliffwater Corporate Lending are ranked lower than 64 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong technical and fundamental indicators, Cliffwater Corporate is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Ep Emerging and Cliffwater Corporate Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Ep Emerging and Cliffwater Corporate

The main advantage of trading using opposite Ep Emerging and Cliffwater Corporate positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ep Emerging position performs unexpectedly, Cliffwater Corporate 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 Cliffwater Corporate will offset losses from the drop in Cliffwater Corporate's long position.
The idea behind Ep Emerging Markets and Cliffwater Corporate Lending 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.
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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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.

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