Correlation Between Clearbridge Value and Sparta Capital
Can any of the company-specific risk be diversified away by investing in both Clearbridge Value and Sparta 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 Clearbridge Value and Sparta Capital into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Clearbridge Value Trust and Sparta Capital, you can compare the effects of market volatilities on Clearbridge Value and Sparta 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 Clearbridge Value with a short position of Sparta Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of Clearbridge Value and Sparta Capital.
Diversification Opportunities for Clearbridge Value and Sparta Capital
0.51 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Clearbridge and Sparta is 0.51. Overlapping area represents the amount of risk that can be diversified away by holding Clearbridge Value Trust and Sparta Capital in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sparta Capital and Clearbridge Value 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 Clearbridge Value Trust are associated (or correlated) with Sparta Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sparta Capital has no effect on the direction of Clearbridge Value i.e., Clearbridge Value and Sparta Capital go up and down completely randomly.
Pair Corralation between Clearbridge Value and Sparta Capital
Assuming the 90 days horizon Clearbridge Value Trust is expected to generate 0.1 times more return on investment than Sparta Capital. However, Clearbridge Value Trust is 9.77 times less risky than Sparta Capital. It trades about 0.27 of its potential returns per unit of risk. Sparta Capital is currently generating about -0.24 per unit of risk. If you would invest 12,522 in Clearbridge Value Trust on October 25, 2024 and sell it today you would earn a total of 468.00 from holding Clearbridge Value Trust or generate 3.74% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Clearbridge Value Trust vs. Sparta Capital
Performance |
| Timeline |
| Clearbridge Value Trust |
| Sparta Capital |
Clearbridge Value and Sparta Capital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Clearbridge Value and Sparta Capital
The main advantage of trading using opposite Clearbridge Value and Sparta Capital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Clearbridge Value position performs unexpectedly, Sparta 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 Sparta Capital will offset losses from the drop in Sparta Capital's long position.| Clearbridge Value vs. Quantitative Longshort Equity | Clearbridge Value vs. Goldman Sachs Equity | Clearbridge Value vs. Artisan Select Equity | Clearbridge Value vs. Greenspring Fund Retail |
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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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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