Correlation Between Great-west Loomis and Vanguard Small-cap
Can any of the company-specific risk be diversified away by investing in both Great-west Loomis 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 Great-west Loomis 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 Great West Loomis Sayles and Vanguard Small Cap Value, you can compare the effects of market volatilities on Great-west Loomis 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 Great-west Loomis with a short position of Vanguard Small-cap. Check out your portfolio center. Please also check ongoing floating volatility patterns of Great-west Loomis and Vanguard Small-cap.
Diversification Opportunities for Great-west Loomis and Vanguard Small-cap
0.94 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Great-west and Vanguard is 0.94. Overlapping area represents the amount of risk that can be diversified away by holding Great West Loomis Sayles and Vanguard Small Cap Value in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Vanguard Small Cap and Great-west Loomis 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 Great West Loomis Sayles 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 Great-west Loomis i.e., Great-west Loomis and Vanguard Small-cap go up and down completely randomly.
Pair Corralation between Great-west Loomis and Vanguard Small-cap
Assuming the 90 days horizon Great West Loomis Sayles is expected to generate 1.31 times more return on investment than Vanguard Small-cap. However, Great-west Loomis is 1.31 times more volatile than Vanguard Small Cap Value. It trades about 0.2 of its potential returns per unit of risk. Vanguard Small Cap Value is currently generating about 0.2 per unit of risk. If you would invest 3,821 in Great West Loomis Sayles on August 24, 2024 and sell it today you would earn a total of 278.00 from holding Great West Loomis Sayles or generate 7.28% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Great West Loomis Sayles vs. Vanguard Small Cap Value
Performance |
| Timeline |
| Great West Loomis |
| Vanguard Small Cap |
Great-west Loomis and Vanguard Small-cap Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Great-west Loomis and Vanguard Small-cap
The main advantage of trading using opposite Great-west Loomis and Vanguard Small-cap positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Great-west Loomis 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.| Great-west Loomis vs. Vanguard Small Cap Value | Great-west Loomis vs. Vanguard Small Cap Value | Great-west Loomis vs. Us Small Cap | Great-west Loomis vs. Us Targeted Value |
| Vanguard Small-cap vs. Dunham High Yield | Vanguard Small-cap vs. Artisan High Income | Vanguard Small-cap vs. American Century High | Vanguard Small-cap vs. Jpmorgan High Yield |
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 CEOs Directory module to screen CEOs from public companies around the world.
Other Complementary Tools
| Efficient Frontier Plot and analyze your portfolio and positions against risk-return landscape of the market. | |
| Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings | |
| Sectors List of equity sectors categorizing publicly traded companies based on their primary business activities | |
| Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk | |
| Insider Screener Find insiders across different sectors to evaluate their impact on performance |