Correlation Between GCM Grosvenor and Nuveen Municipalome
Can any of the company-specific risk be diversified away by investing in both GCM Grosvenor and Nuveen Municipalome 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 Nuveen Municipalome into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between GCM Grosvenor and Nuveen Municipalome, you can compare the effects of market volatilities on GCM Grosvenor and Nuveen Municipalome 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 Nuveen Municipalome. Check out your portfolio center. Please also check ongoing floating volatility patterns of GCM Grosvenor and Nuveen Municipalome.
Diversification Opportunities for GCM Grosvenor and Nuveen Municipalome
-0.55 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between GCM and Nuveen is -0.55. Overlapping area represents the amount of risk that can be diversified away by holding GCM Grosvenor and Nuveen Municipalome in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nuveen Municipalome 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 Nuveen Municipalome. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nuveen Municipalome has no effect on the direction of GCM Grosvenor i.e., GCM Grosvenor and Nuveen Municipalome go up and down completely randomly.
Pair Corralation between GCM Grosvenor and Nuveen Municipalome
Assuming the 90 days horizon GCM Grosvenor is expected to generate 21.87 times more return on investment than Nuveen Municipalome. However, GCM Grosvenor is 21.87 times more volatile than Nuveen Municipalome. It trades about 0.18 of its potential returns per unit of risk. Nuveen Municipalome is currently generating about -0.1 per unit of risk. If you would invest 100.00 in GCM Grosvenor on August 29, 2024 and sell it today you would earn a total of 29.00 from holding GCM Grosvenor or generate 29.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
GCM Grosvenor vs. Nuveen Municipalome
Performance |
| Timeline |
| GCM Grosvenor |
| Nuveen Municipalome |
GCM Grosvenor and Nuveen Municipalome Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GCM Grosvenor and Nuveen Municipalome
The main advantage of trading using opposite GCM Grosvenor and Nuveen Municipalome positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GCM Grosvenor position performs unexpectedly, Nuveen Municipalome 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 Nuveen Municipalome will offset losses from the drop in Nuveen Municipalome's long position.| GCM Grosvenor vs. Aurora Innovation | GCM Grosvenor vs. HUMANA INC | GCM Grosvenor vs. Aquagold International | GCM Grosvenor vs. Barloworld Ltd ADR |
| Nuveen Municipalome vs. DTF Tax Free | Nuveen Municipalome vs. MFS High Yield | Nuveen Municipalome vs. MFS High Income | Nuveen Municipalome vs. John Hancock Income |
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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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