Correlation Between Gmo Core and Ancora Microcap
Can any of the company-specific risk be diversified away by investing in both Gmo Core and Ancora Microcap 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 Gmo Core and Ancora Microcap into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Gmo E Plus and Ancora Microcap Fund, you can compare the effects of market volatilities on Gmo Core and Ancora Microcap 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 Gmo Core with a short position of Ancora Microcap. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gmo Core and Ancora Microcap.
Diversification Opportunities for Gmo Core and Ancora Microcap
-0.66 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Gmo and Ancora is -0.66. Overlapping area represents the amount of risk that can be diversified away by holding Gmo E Plus and Ancora Microcap Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ancora Microcap and Gmo Core 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 Gmo E Plus are associated (or correlated) with Ancora Microcap. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ancora Microcap has no effect on the direction of Gmo Core i.e., Gmo Core and Ancora Microcap go up and down completely randomly.
Pair Corralation between Gmo Core and Ancora Microcap
Assuming the 90 days horizon Gmo Core is expected to generate 2.36 times less return on investment than Ancora Microcap. But when comparing it to its historical volatility, Gmo E Plus is 2.59 times less risky than Ancora Microcap. It trades about 0.05 of its potential returns per unit of risk. Ancora Microcap Fund is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 1,553 in Ancora Microcap Fund on August 31, 2024 and sell it today you would earn a total of 234.00 from holding Ancora Microcap Fund or generate 15.07% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 99.73% |
| Values | Daily Returns |
Gmo E Plus vs. Ancora Microcap Fund
Performance |
| Timeline |
| Gmo E Plus |
| Ancora Microcap |
Gmo Core and Ancora Microcap Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Gmo Core and Ancora Microcap
The main advantage of trading using opposite Gmo Core and Ancora Microcap positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gmo Core position performs unexpectedly, Ancora Microcap 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 Ancora Microcap will offset losses from the drop in Ancora Microcap's long position.| Gmo Core vs. Alger Health Sciences | Gmo Core vs. The Gabelli Healthcare | Gmo Core vs. Health Care Fund | Gmo Core vs. Alphacentric Lifesci Healthcare |
| Ancora Microcap vs. Hennessy Technology Fund | Ancora Microcap vs. Blackrock Science Technology | Ancora Microcap vs. Janus Global Technology | Ancora Microcap vs. Pgim Jennison Technology |
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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
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