Correlation Between Cambria Tail and NKEQ
Can any of the company-specific risk be diversified away by investing in both Cambria Tail and NKEQ 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 Cambria Tail and NKEQ into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cambria Tail Risk and NKEQ, you can compare the effects of market volatilities on Cambria Tail and NKEQ 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 Cambria Tail with a short position of NKEQ. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cambria Tail and NKEQ.
Diversification Opportunities for Cambria Tail and NKEQ
-0.8 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Cambria and NKEQ is -0.8. Overlapping area represents the amount of risk that can be diversified away by holding Cambria Tail Risk and NKEQ in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NKEQ and Cambria Tail 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 Cambria Tail Risk are associated (or correlated) with NKEQ. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NKEQ has no effect on the direction of Cambria Tail i.e., Cambria Tail and NKEQ go up and down completely randomly.
Pair Corralation between Cambria Tail and NKEQ
If you would invest 2,895 in NKEQ on September 4, 2024 and sell it today you would earn a total of 0.00 from holding NKEQ or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 4.76% |
| Values | Daily Returns |
Cambria Tail Risk vs. NKEQ
Performance |
| Timeline |
| Cambria Tail Risk |
| NKEQ |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Cambria Tail and NKEQ Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cambria Tail and NKEQ
The main advantage of trading using opposite Cambria Tail and NKEQ positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cambria Tail position performs unexpectedly, NKEQ 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 NKEQ will offset losses from the drop in NKEQ's long position.| Cambria Tail vs. Amplify BlackSwan Growth | Cambria Tail vs. AGFiQ Market Neutral | Cambria Tail vs. Quadratic Interest Rate | Cambria Tail vs. AdvisorShares Dorsey Wright |
| NKEQ vs. ProShares UltraShort MSCI | NKEQ vs. ProShares Ultra MSCI | NKEQ vs. ProShares UltraShort MSCI | NKEQ vs. Direxion Daily MSCI |
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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
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