Correlation Between Cambria Value and Cambria Trinity
Can any of the company-specific risk be diversified away by investing in both Cambria Value and Cambria Trinity 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 Cambria Trinity 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 Cambria Trinity ETF, you can compare the effects of market volatilities on Cambria Value and Cambria Trinity 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 Cambria Trinity. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cambria Value and Cambria Trinity.
Diversification Opportunities for Cambria Value and Cambria Trinity
0.62 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Cambria and Cambria is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding Cambria Value and and Cambria Trinity ETF in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cambria Trinity ETF 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 Cambria Trinity. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cambria Trinity ETF has no effect on the direction of Cambria Value i.e., Cambria Value and Cambria Trinity go up and down completely randomly.
Pair Corralation between Cambria Value and Cambria Trinity
Given the investment horizon of 90 days Cambria Value and is expected to generate 1.66 times more return on investment than Cambria Trinity. However, Cambria Value is 1.66 times more volatile than Cambria Trinity ETF. It trades about 0.04 of its potential returns per unit of risk. Cambria Trinity ETF is currently generating about 0.05 per unit of risk. If you would invest 2,674 in Cambria Value and on August 27, 2024 and sell it today you would earn a total of 536.00 from holding Cambria Value and or generate 20.04% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Cambria Value and vs. Cambria Trinity ETF
Performance |
| Timeline |
| Cambria Value |
| Cambria Trinity ETF |
Cambria Value and Cambria Trinity Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cambria Value and Cambria Trinity
The main advantage of trading using opposite Cambria Value and Cambria Trinity positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cambria Value position performs unexpectedly, Cambria Trinity 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 Trinity will offset losses from the drop in Cambria Trinity's long position.| Cambria Value vs. WisdomTree 9060 Balanced | Cambria Value vs. RPAR Risk Parity | Cambria Value vs. Cambria Tail Risk | Cambria Value vs. Aptus Defined Risk |
| Cambria Trinity vs. Cambria Global Asset | Cambria Trinity vs. Cambria Global Momentum | Cambria Trinity vs. Cambria Emerging Shareholder | Cambria Trinity 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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
Other Complementary Tools
| Insider Screener Find insiders across different sectors to evaluate their impact on performance | |
| AI Portfolio Architect Use AI to generate optimal portfolios and find profitable investment opportunities | |
| Stocks Directory Find actively traded stocks across global markets | |
| Global Correlations Find global opportunities by holding instruments from different markets | |
| Correlation Analysis Reduce portfolio risk simply by holding instruments which are not perfectly correlated |