Correlation Between Cambria Value and Fairlead Tactical
Can any of the company-specific risk be diversified away by investing in both Cambria Value and Fairlead Tactical 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 Value and Fairlead Tactical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cambria Value and and Fairlead Tactical Sector, you can compare the effects of market volatilities on Cambria Value and Fairlead Tactical 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 Value with a short position of Fairlead Tactical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cambria Value and Fairlead Tactical.
Diversification Opportunities for Cambria Value and Fairlead Tactical
0.91 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Cambria and Fairlead is 0.91. Overlapping area represents the amount of risk that can be diversified away by holding Cambria Value and and Fairlead Tactical Sector in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fairlead Tactical Sector and Cambria Value 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 Value and are associated (or correlated) with Fairlead Tactical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fairlead Tactical Sector has no effect on the direction of Cambria Value i.e., Cambria Value and Fairlead Tactical go up and down completely randomly.
Pair Corralation between Cambria Value and Fairlead Tactical
Given the investment horizon of 90 days Cambria Value and is expected to under-perform the Fairlead Tactical. In addition to that, Cambria Value is 1.62 times more volatile than Fairlead Tactical Sector. It trades about -0.17 of its total potential returns per unit of risk. Fairlead Tactical Sector is currently generating about -0.08 per unit of volatility. If you would invest 2,872 in Fairlead Tactical Sector on September 12, 2024 and sell it today you would lose (24.00) from holding Fairlead Tactical Sector or give up 0.84% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Cambria Value and vs. Fairlead Tactical Sector
Performance |
| Timeline |
| Cambria Value |
| Fairlead Tactical Sector |
Cambria Value and Fairlead Tactical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cambria Value and Fairlead Tactical
The main advantage of trading using opposite Cambria Value and Fairlead Tactical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cambria Value position performs unexpectedly, Fairlead Tactical 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 Fairlead Tactical will offset losses from the drop in Fairlead Tactical's long position.| Cambria Value vs. Cambria Global Momentum | Cambria Value vs. Cambria Emerging Shareholder | Cambria Value vs. Cambria Shareholder Yield | Cambria Value vs. Cambria Foreign Shareholder |
| Fairlead Tactical vs. FT Cboe Vest | Fairlead Tactical vs. First Trust Exchange Traded | Fairlead Tactical vs. FT Cboe Vest | Fairlead Tactical vs. Anfield Equity Sector |
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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