Correlation Between NYSE Composite and GCM Grosvenor
Can any of the company-specific risk be diversified away by investing in both NYSE Composite and GCM Grosvenor 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 NYSE Composite and GCM Grosvenor into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between NYSE Composite and GCM Grosvenor, you can compare the effects of market volatilities on NYSE Composite and GCM Grosvenor 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 NYSE Composite with a short position of GCM Grosvenor. Check out your portfolio center. Please also check ongoing floating volatility patterns of NYSE Composite and GCM Grosvenor.
Diversification Opportunities for NYSE Composite and GCM Grosvenor
-0.04 | Correlation Coefficient |
Good diversification
The 3 months correlation between NYSE and GCM is -0.04. Overlapping area represents the amount of risk that can be diversified away by holding NYSE Composite and GCM Grosvenor in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GCM Grosvenor and NYSE Composite 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 NYSE Composite are associated (or correlated) with GCM Grosvenor. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GCM Grosvenor has no effect on the direction of NYSE Composite i.e., NYSE Composite and GCM Grosvenor go up and down completely randomly.
Pair Corralation between NYSE Composite and GCM Grosvenor
Assuming the 90 days trading horizon NYSE Composite is expected to generate 2.41 times less return on investment than GCM Grosvenor. But when comparing it to its historical volatility, NYSE Composite is 2.0 times less risky than GCM Grosvenor. It trades about 0.07 of its potential returns per unit of risk. GCM Grosvenor is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 809.00 in GCM Grosvenor on November 5, 2024 and sell it today you would earn a total of 543.00 from holding GCM Grosvenor or generate 67.12% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.8% |
| Values | Daily Returns |
NYSE Composite vs. GCM Grosvenor
Performance |
| Timeline |
NYSE Composite and GCM Grosvenor Volatility Contrast
Predicted Return Density |
| Returns |
NYSE Composite
Pair trading matchups for NYSE Composite
GCM Grosvenor
Pair trading matchups for GCM Grosvenor
Pair Trading with NYSE Composite and GCM Grosvenor
The main advantage of trading using opposite NYSE Composite and GCM Grosvenor positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NYSE Composite position performs unexpectedly, GCM Grosvenor 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 GCM Grosvenor will offset losses from the drop in GCM Grosvenor's long position.| NYSE Composite vs. Lion One Metals | NYSE Composite vs. Codexis | NYSE Composite vs. Yuexiu Transport Infrastructure | NYSE Composite vs. Saia Inc |
| GCM Grosvenor vs. MFS Investment Grade | GCM Grosvenor vs. Eaton Vance National | GCM Grosvenor vs. Nuveen California Select | GCM Grosvenor vs. Federated Premier Municipal |
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 Portfolio Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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