Correlation Between GCM Grosvenor and Focus Financial
Can any of the company-specific risk be diversified away by investing in both GCM Grosvenor and Focus Financial 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 GCM Grosvenor and Focus Financial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between GCM Grosvenor and Focus Financial Partners, you can compare the effects of market volatilities on GCM Grosvenor and Focus Financial 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 GCM Grosvenor with a short position of Focus Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of GCM Grosvenor and Focus Financial.
Diversification Opportunities for GCM Grosvenor and Focus Financial
0.66 | Correlation Coefficient |
Poor diversification
The 3 months correlation between GCM and Focus is 0.66. Overlapping area represents the amount of risk that can be diversified away by holding GCM Grosvenor and Focus Financial Partners in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Focus Financial Partners and GCM Grosvenor 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 GCM Grosvenor are associated (or correlated) with Focus Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Focus Financial Partners has no effect on the direction of GCM Grosvenor i.e., GCM Grosvenor and Focus Financial go up and down completely randomly.
Pair Corralation between GCM Grosvenor and Focus Financial
If you would invest 1,171 in GCM Grosvenor on August 28, 2024 and sell it today you would earn a total of 64.00 from holding GCM Grosvenor or generate 5.47% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 4.55% |
| Values | Daily Returns |
GCM Grosvenor vs. Focus Financial Partners
Performance |
| Timeline |
| GCM Grosvenor |
| Focus Financial Partners |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
GCM Grosvenor and Focus Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GCM Grosvenor and Focus Financial
The main advantage of trading using opposite GCM Grosvenor and Focus Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GCM Grosvenor position performs unexpectedly, Focus Financial 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 Focus Financial will offset losses from the drop in Focus Financial's long position.| GCM Grosvenor vs. Aurora Innovation | GCM Grosvenor vs. HUMANA INC | GCM Grosvenor vs. Aquagold International | GCM Grosvenor vs. Barloworld Ltd ADR |
| Focus Financial vs. Federated Premier Municipal | Focus Financial vs. Blackrock Muniyield | Focus Financial vs. Diamond Hill Investment | Focus Financial vs. NXG NextGen Infrastructure |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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