Correlation Between GCM Grosvenor and Oak Woods
Can any of the company-specific risk be diversified away by investing in both GCM Grosvenor and Oak Woods 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 Oak Woods into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between GCM Grosvenor and Oak Woods Acquisition, you can compare the effects of market volatilities on GCM Grosvenor and Oak Woods 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 Oak Woods. Check out your portfolio center. Please also check ongoing floating volatility patterns of GCM Grosvenor and Oak Woods.
Diversification Opportunities for GCM Grosvenor and Oak Woods
-0.33 | Correlation Coefficient |
Very good diversification
The 3 months correlation between GCM and Oak is -0.33. Overlapping area represents the amount of risk that can be diversified away by holding GCM Grosvenor and Oak Woods Acquisition in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Oak Woods Acquisition 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 Oak Woods. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Oak Woods Acquisition has no effect on the direction of GCM Grosvenor i.e., GCM Grosvenor and Oak Woods go up and down completely randomly.
Pair Corralation between GCM Grosvenor and Oak Woods
Assuming the 90 days horizon GCM Grosvenor is expected to generate 5.91 times more return on investment than Oak Woods. However, GCM Grosvenor is 5.91 times more volatile than Oak Woods Acquisition. It trades about 0.09 of its potential returns per unit of risk. Oak Woods Acquisition is currently generating about 0.06 per unit of risk. If you would invest 31.00 in GCM Grosvenor on September 3, 2024 and sell it today you would earn a total of 83.00 from holding GCM Grosvenor or generate 267.74% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 84.52% |
| Values | Daily Returns |
GCM Grosvenor vs. Oak Woods Acquisition
Performance |
| Timeline |
| GCM Grosvenor |
| Oak Woods Acquisition |
GCM Grosvenor and Oak Woods Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GCM Grosvenor and Oak Woods
The main advantage of trading using opposite GCM Grosvenor and Oak Woods positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GCM Grosvenor position performs unexpectedly, Oak Woods 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 Oak Woods will offset losses from the drop in Oak Woods' long position.| GCM Grosvenor vs. Federated Premier Municipal | GCM Grosvenor vs. Blackrock Muniyield | GCM Grosvenor vs. Federated Investors B | GCM Grosvenor vs. SEI Investments |
| Oak Woods vs. Highway Holdings Limited | Oak Woods vs. Siriuspoint | Oak Woods vs. Avient Corp | Oak Woods vs. AmTrust Financial Services |
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 Portfolio Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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