Correlation Between GCM Grosvenor and Ready Capital
Can any of the company-specific risk be diversified away by investing in both GCM Grosvenor and Ready Capital 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 Ready Capital into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between GCM Grosvenor and Ready Capital Corp, you can compare the effects of market volatilities on GCM Grosvenor and Ready Capital 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 Ready Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of GCM Grosvenor and Ready Capital.
Diversification Opportunities for GCM Grosvenor and Ready Capital
-0.55 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between GCM and Ready is -0.55. Overlapping area represents the amount of risk that can be diversified away by holding GCM Grosvenor and Ready Capital Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ready Capital Corp 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 Ready Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ready Capital Corp has no effect on the direction of GCM Grosvenor i.e., GCM Grosvenor and Ready Capital go up and down completely randomly.
Pair Corralation between GCM Grosvenor and Ready Capital
Assuming the 90 days horizon GCM Grosvenor is expected to generate 52.93 times more return on investment than Ready Capital. However, GCM Grosvenor is 52.93 times more volatile than Ready Capital Corp. It trades about 0.1 of its potential returns per unit of risk. Ready Capital Corp is currently generating about -0.03 per unit of risk. If you would invest 29.00 in GCM Grosvenor on August 26, 2024 and sell it today you would earn a total of 90.00 from holding GCM Grosvenor or generate 310.34% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 85.14% |
| Values | Daily Returns |
GCM Grosvenor vs. Ready Capital Corp
Performance |
| Timeline |
| GCM Grosvenor |
| Ready Capital Corp |
GCM Grosvenor and Ready Capital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GCM Grosvenor and Ready Capital
The main advantage of trading using opposite GCM Grosvenor and Ready Capital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GCM Grosvenor position performs unexpectedly, Ready Capital 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 Ready Capital will offset losses from the drop in Ready Capital's long position.| GCM Grosvenor vs. PowerUp Acquisition Corp | GCM Grosvenor vs. Aurora Innovation | GCM Grosvenor vs. HUMANA INC | GCM Grosvenor vs. Aquagold International |
| Ready Capital vs. Blackstone Mortgage Trust | Ready Capital vs. Omega Healthcare Investors | Ready Capital vs. Medical Properties Trust |
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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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