Correlation Between Cambria Global and Cambria Emerging
Can any of the company-specific risk be diversified away by investing in both Cambria Global and Cambria Emerging 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 Cambria Global and Cambria Emerging into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cambria Global Momentum and Cambria Emerging Shareholder, you can compare the effects of market volatilities on Cambria Global and Cambria Emerging 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 Cambria Global with a short position of Cambria Emerging. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cambria Global and Cambria Emerging.
Diversification Opportunities for Cambria Global and Cambria Emerging
0.18 | Correlation Coefficient |
Average diversification
The 3 months correlation between Cambria and Cambria is 0.18. Overlapping area represents the amount of risk that can be diversified away by holding Cambria Global Momentum and Cambria Emerging Shareholder in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cambria Emerging Sha and Cambria Global 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 Cambria Global Momentum are associated (or correlated) with Cambria Emerging. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cambria Emerging Sha has no effect on the direction of Cambria Global i.e., Cambria Global and Cambria Emerging go up and down completely randomly.
Pair Corralation between Cambria Global and Cambria Emerging
Given the investment horizon of 90 days Cambria Global Momentum is expected to generate 0.91 times more return on investment than Cambria Emerging. However, Cambria Global Momentum is 1.1 times less risky than Cambria Emerging. It trades about 0.11 of its potential returns per unit of risk. Cambria Emerging Shareholder is currently generating about -0.11 per unit of risk. If you would invest 2,967 in Cambria Global Momentum on August 27, 2024 and sell it today you would earn a total of 60.00 from holding Cambria Global Momentum or generate 2.02% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Cambria Global Momentum vs. Cambria Emerging Shareholder
Performance |
| Timeline |
| Cambria Global Momentum |
| Cambria Emerging Sha |
Cambria Global and Cambria Emerging Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cambria Global and Cambria Emerging
The main advantage of trading using opposite Cambria Global and Cambria Emerging positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cambria Global position performs unexpectedly, Cambria Emerging 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 Cambria Emerging will offset losses from the drop in Cambria Emerging's long position.| Cambria Global vs. Argent Mid Cap | Cambria Global vs. Calumet Specialty Products | Cambria Global vs. Loop Industries | Cambria Global vs. Hurco Companies |
| Cambria Emerging vs. Cambria Foreign Shareholder | Cambria Emerging vs. Cambria Global Value | Cambria Emerging vs. Cambria Global Momentum | Cambria Emerging vs. Cambria Value and |
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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
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