Correlation Between Cambria Trinity and Cambria Emerging
Can any of the company-specific risk be diversified away by investing in both Cambria Trinity and Cambria Emerging 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 Trinity and Cambria Emerging into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cambria Trinity ETF and Cambria Emerging Shareholder, you can compare the effects of market volatilities on Cambria Trinity and Cambria Emerging 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 Trinity with a short position of Cambria Emerging. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cambria Trinity and Cambria Emerging.
Diversification Opportunities for Cambria Trinity and Cambria Emerging
0.33 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Cambria and Cambria is 0.33. Overlapping area represents the amount of risk that can be diversified away by holding Cambria Trinity ETF and Cambria Emerging Shareholder in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cambria Emerging Sha and Cambria Trinity 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 Trinity ETF are associated (or correlated) with Cambria Emerging. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cambria Emerging Sha has no effect on the direction of Cambria Trinity i.e., Cambria Trinity and Cambria Emerging go up and down completely randomly.
Pair Corralation between Cambria Trinity and Cambria Emerging
Given the investment horizon of 90 days Cambria Trinity ETF is expected to generate 0.47 times more return on investment than Cambria Emerging. However, Cambria Trinity ETF is 2.11 times less risky than Cambria Emerging. It trades about 0.28 of its potential returns per unit of risk. Cambria Emerging Shareholder is currently generating about -0.06 per unit of risk. If you would invest 2,566 in Cambria Trinity ETF on September 1, 2024 and sell it today you would earn a total of 75.00 from holding Cambria Trinity ETF or generate 2.92% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Cambria Trinity ETF vs. Cambria Emerging Shareholder
Performance |
| Timeline |
| Cambria Trinity ETF |
| Cambria Emerging Sha |
Cambria Trinity and Cambria Emerging Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cambria Trinity and Cambria Emerging
The main advantage of trading using opposite Cambria Trinity and Cambria Emerging positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cambria Trinity position performs unexpectedly, Cambria Emerging 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 Cambria Emerging will offset losses from the drop in Cambria Emerging's long position.| Cambria Trinity vs. Cambria Global Asset | Cambria Trinity vs. Cambria Global Value | Cambria Trinity vs. Cambria Foreign Shareholder | Cambria Trinity vs. Cambria Value and |
| Cambria Emerging vs. Cambria Foreign Shareholder | Cambria Emerging vs. Cambria Global Value | Cambria Emerging vs. Cambria Global Momentum | Cambria Emerging vs. Cambria Value and |
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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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