Correlation Between PureCycle Technologies and GCM Grosvenor
Can any of the company-specific risk be diversified away by investing in both PureCycle Technologies 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 PureCycle Technologies and GCM Grosvenor into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PureCycle Technologies and GCM Grosvenor, you can compare the effects of market volatilities on PureCycle Technologies 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 PureCycle Technologies with a short position of GCM Grosvenor. Check out your portfolio center. Please also check ongoing floating volatility patterns of PureCycle Technologies and GCM Grosvenor.
Diversification Opportunities for PureCycle Technologies and GCM Grosvenor
0.63 | Correlation Coefficient |
Poor diversification
The 3 months correlation between PureCycle and GCM is 0.63. Overlapping area represents the amount of risk that can be diversified away by holding PureCycle Technologies and GCM Grosvenor in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GCM Grosvenor and PureCycle Technologies 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 PureCycle Technologies 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 PureCycle Technologies i.e., PureCycle Technologies and GCM Grosvenor go up and down completely randomly.
Pair Corralation between PureCycle Technologies and GCM Grosvenor
Assuming the 90 days horizon PureCycle Technologies is expected to generate 0.99 times more return on investment than GCM Grosvenor. However, PureCycle Technologies is 1.02 times less risky than GCM Grosvenor. It trades about 0.21 of its potential returns per unit of risk. GCM Grosvenor is currently generating about 0.17 per unit of risk. If you would invest 281.00 in PureCycle Technologies on September 3, 2024 and sell it today you would earn a total of 209.00 from holding PureCycle Technologies or generate 74.38% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.12% |
| Values | Daily Returns |
PureCycle Technologies vs. GCM Grosvenor
Performance |
| Timeline |
| PureCycle Technologies |
| GCM Grosvenor |
PureCycle Technologies and GCM Grosvenor Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PureCycle Technologies and GCM Grosvenor
The main advantage of trading using opposite PureCycle Technologies and GCM Grosvenor positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PureCycle Technologies 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.| PureCycle Technologies vs. Origin Materials Warrant | PureCycle Technologies vs. Purecycle Technologies Holdings | PureCycle Technologies vs. Blade Air Mobility |
| GCM Grosvenor vs. Federated Premier Municipal | GCM Grosvenor vs. Blackrock Muniyield | GCM Grosvenor vs. Federated Investors B | GCM Grosvenor vs. SEI Investments |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
Other Complementary Tools
| Price Transformation Use Price Transformation models to analyze the depth of different equity instruments across global markets | |
| Money Flow Index Determine momentum by analyzing Money Flow Index and other technical indicators | |
| Headlines Timeline Stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity | |
| Theme Ratings Determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum |