Correlation Between Amg Gwk and Vanguard Small-cap
Can any of the company-specific risk be diversified away by investing in both Amg Gwk and Vanguard Small-cap 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 Amg Gwk and Vanguard Small-cap into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Amg Gwk Small and Vanguard Small Cap Index, you can compare the effects of market volatilities on Amg Gwk and Vanguard Small-cap 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 Amg Gwk with a short position of Vanguard Small-cap. Check out your portfolio center. Please also check ongoing floating volatility patterns of Amg Gwk and Vanguard Small-cap.
Diversification Opportunities for Amg Gwk and Vanguard Small-cap
0.97 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Amg and Vanguard is 0.97. Overlapping area represents the amount of risk that can be diversified away by holding Amg Gwk Small and Vanguard Small Cap Index in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Vanguard Small Cap and Amg Gwk 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 Amg Gwk Small are associated (or correlated) with Vanguard Small-cap. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Vanguard Small Cap has no effect on the direction of Amg Gwk i.e., Amg Gwk and Vanguard Small-cap go up and down completely randomly.
Pair Corralation between Amg Gwk and Vanguard Small-cap
Assuming the 90 days horizon Amg Gwk is expected to generate 1.35 times less return on investment than Vanguard Small-cap. In addition to that, Amg Gwk is 1.06 times more volatile than Vanguard Small Cap Index. It trades about 0.05 of its total potential returns per unit of risk. Vanguard Small Cap Index is currently generating about 0.07 per unit of volatility. If you would invest 8,823 in Vanguard Small Cap Index on September 2, 2024 and sell it today you would earn a total of 3,651 from holding Vanguard Small Cap Index or generate 41.38% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Amg Gwk Small vs. Vanguard Small Cap Index
Performance |
| Timeline |
| Amg Gwk Small |
| Vanguard Small Cap |
Amg Gwk and Vanguard Small-cap Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Amg Gwk and Vanguard Small-cap
The main advantage of trading using opposite Amg Gwk and Vanguard Small-cap positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Amg Gwk position performs unexpectedly, Vanguard Small-cap 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 Vanguard Small-cap will offset losses from the drop in Vanguard Small-cap's long position.| Amg Gwk vs. T Rowe Price | Amg Gwk vs. Amg Gwk Small | Amg Gwk vs. Aberdeen Emerging Markts | Amg Gwk vs. Invesco Disciplined Equity |
| Vanguard Small-cap vs. Vanguard Strategic Small Cap | Vanguard Small-cap vs. Vanguard Emerging Markets | Vanguard Small-cap vs. Vanguard Diversified Equity | Vanguard Small-cap vs. Vanguard Mid Cap |
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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
Other Complementary Tools
| Latest Portfolios Quick portfolio dashboard that showcases your latest portfolios | |
| Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities | |
| Idea Optimizer Use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio | |
| Portfolio Volatility Check portfolio volatility and analyze historical return density to properly model market risk | |
| Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas |