Correlation Between Evercore Partners and BGC
Can any of the company-specific risk be diversified away by investing in both Evercore Partners and BGC 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 Evercore Partners and BGC into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Evercore Partners and BGC Group, you can compare the effects of market volatilities on Evercore Partners and BGC 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 Evercore Partners with a short position of BGC. Check out your portfolio center. Please also check ongoing floating volatility patterns of Evercore Partners and BGC.
Diversification Opportunities for Evercore Partners and BGC
0.6 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Evercore and BGC is 0.6. Overlapping area represents the amount of risk that can be diversified away by holding Evercore Partners and BGC Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BGC Group and Evercore Partners 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 Evercore Partners are associated (or correlated) with BGC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BGC Group has no effect on the direction of Evercore Partners i.e., Evercore Partners and BGC go up and down completely randomly.
Pair Corralation between Evercore Partners and BGC
Considering the 90-day investment horizon Evercore Partners is expected to generate 1.25 times more return on investment than BGC. However, Evercore Partners is 1.25 times more volatile than BGC Group. It trades about 0.19 of its potential returns per unit of risk. BGC Group is currently generating about 0.07 per unit of risk. If you would invest 26,521 in Evercore Partners on August 30, 2024 and sell it today you would earn a total of 4,289 from holding Evercore Partners or generate 16.17% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Evercore Partners vs. BGC Group
Performance |
| Timeline |
| Evercore Partners |
| BGC Group |
Evercore Partners and BGC Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Evercore Partners and BGC
The main advantage of trading using opposite Evercore Partners and BGC positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Evercore Partners position performs unexpectedly, BGC 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 BGC will offset losses from the drop in BGC's long position.| Evercore Partners vs. PJT Partners | Evercore Partners vs. Moelis Co | Evercore Partners vs. Perella Weinberg Partners | Evercore Partners vs. Jefferies Financial Group |
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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
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