Correlation Between Regional Management and GCM Grosvenor
Can any of the company-specific risk be diversified away by investing in both Regional Management 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 Regional Management and GCM Grosvenor into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Regional Management Corp and GCM Grosvenor, you can compare the effects of market volatilities on Regional Management 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 Regional Management with a short position of GCM Grosvenor. Check out your portfolio center. Please also check ongoing floating volatility patterns of Regional Management and GCM Grosvenor.
Diversification Opportunities for Regional Management and GCM Grosvenor
-0.47 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Regional and GCM is -0.47. Overlapping area represents the amount of risk that can be diversified away by holding Regional Management Corp and GCM Grosvenor in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GCM Grosvenor and Regional Management 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 Regional Management Corp 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 Regional Management i.e., Regional Management and GCM Grosvenor go up and down completely randomly.
Pair Corralation between Regional Management and GCM Grosvenor
Allowing for the 90-day total investment horizon Regional Management Corp is expected to generate 1.58 times more return on investment than GCM Grosvenor. However, Regional Management is 1.58 times more volatile than GCM Grosvenor. It trades about 0.11 of its potential returns per unit of risk. GCM Grosvenor is currently generating about 0.14 per unit of risk. If you would invest 2,883 in Regional Management Corp on August 28, 2024 and sell it today you would earn a total of 189.00 from holding Regional Management Corp or generate 6.56% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Regional Management Corp vs. GCM Grosvenor
Performance |
| Timeline |
| Regional Management Corp |
| GCM Grosvenor |
Regional Management and GCM Grosvenor Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Regional Management and GCM Grosvenor
The main advantage of trading using opposite Regional Management and GCM Grosvenor positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Regional Management 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.| Regional Management vs. SLM Corp Pb | Regional Management vs. FirstCash | Regional Management vs. Navient Corp | Regional Management vs. Orix Corp Ads |
| GCM Grosvenor vs. Aurora Innovation | GCM Grosvenor vs. HUMANA INC | GCM Grosvenor vs. Aquagold International | GCM Grosvenor vs. Barloworld Ltd ADR |
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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
Other Complementary Tools
| AI Portfolio Architect Use AI to generate optimal portfolios and find profitable investment opportunities | |
| Portfolio Rebalancing Analyze risk-adjusted returns against different time horizons to find asset-allocation targets | |
| Equity Search Search for actively traded equities including funds and ETFs from over 30 global markets | |
| Portfolio Anywhere Track or share privately all of your investments from the convenience of any device | |
| Commodity Channel Use Commodity Channel Index to analyze current equity momentum |