Correlation Between Grant Park and Counterpoint Tactical
Can any of the company-specific risk be diversified away by investing in both Grant Park and Counterpoint Tactical 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 Grant Park and Counterpoint Tactical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Grant Park Multi and Counterpoint Tactical Equity, you can compare the effects of market volatilities on Grant Park and Counterpoint Tactical 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 Grant Park with a short position of Counterpoint Tactical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Grant Park and Counterpoint Tactical.
Diversification Opportunities for Grant Park and Counterpoint Tactical
-0.53 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Grant and Counterpoint is -0.53. Overlapping area represents the amount of risk that can be diversified away by holding Grant Park Multi and Counterpoint Tactical Equity in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Counterpoint Tactical and Grant Park 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 Grant Park Multi are associated (or correlated) with Counterpoint Tactical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Counterpoint Tactical has no effect on the direction of Grant Park i.e., Grant Park and Counterpoint Tactical go up and down completely randomly.
Pair Corralation between Grant Park and Counterpoint Tactical
Assuming the 90 days horizon Grant Park is expected to generate 11.14 times less return on investment than Counterpoint Tactical. But when comparing it to its historical volatility, Grant Park Multi is 1.69 times less risky than Counterpoint Tactical. It trades about 0.02 of its potential returns per unit of risk. Counterpoint Tactical Equity is currently generating about 0.12 of returns per unit of risk over similar time horizon. If you would invest 1,560 in Counterpoint Tactical Equity on September 3, 2024 and sell it today you would earn a total of 748.00 from holding Counterpoint Tactical Equity or generate 47.95% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Grant Park Multi vs. Counterpoint Tactical Equity
Performance |
| Timeline |
| Grant Park Multi |
| Counterpoint Tactical |
Grant Park and Counterpoint Tactical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Grant Park and Counterpoint Tactical
The main advantage of trading using opposite Grant Park and Counterpoint Tactical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Grant Park position performs unexpectedly, Counterpoint Tactical 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 Counterpoint Tactical will offset losses from the drop in Counterpoint Tactical's long position.| Grant Park vs. Jpmorgan Equity Income | Grant Park vs. Us Strategic Equity | Grant Park vs. Cutler Equity | Grant Park vs. Ab Select Equity |
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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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