Correlation Between Cm Modity and Gmo High
Can any of the company-specific risk be diversified away by investing in both Cm Modity and Gmo High 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 Cm Modity and Gmo High into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cm Modity Index and Gmo High Yield, you can compare the effects of market volatilities on Cm Modity and Gmo High 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 Cm Modity with a short position of Gmo High. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cm Modity and Gmo High.
Diversification Opportunities for Cm Modity and Gmo High
Poor diversification
The 3 months correlation between COMIX and Gmo is 0.73. Overlapping area represents the amount of risk that can be diversified away by holding Cm Modity Index and Gmo High Yield in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gmo High Yield and Cm Modity 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 Cm Modity Index are associated (or correlated) with Gmo High. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gmo High Yield has no effect on the direction of Cm Modity i.e., Cm Modity and Gmo High go up and down completely randomly.
Pair Corralation between Cm Modity and Gmo High
Assuming the 90 days horizon Cm Modity is expected to generate 1.05 times less return on investment than Gmo High. In addition to that, Cm Modity is 3.43 times more volatile than Gmo High Yield. It trades about 0.08 of its total potential returns per unit of risk. Gmo High Yield is currently generating about 0.3 per unit of volatility. If you would invest 1,697 in Gmo High Yield on April 29, 2025 and sell it today you would earn a total of 66.00 from holding Gmo High Yield or generate 3.89% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Significant |
Accuracy | 100.0% |
Values | Daily Returns |
Cm Modity Index vs. Gmo High Yield
Performance |
Timeline |
Cm Modity Index |
Gmo High Yield |
Cm Modity and Gmo High Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Cm Modity and Gmo High
The main advantage of trading using opposite Cm Modity and Gmo High positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cm Modity position performs unexpectedly, Gmo High 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 Gmo High will offset losses from the drop in Gmo High's long position.Cm Modity vs. Vanguard Financials Index | Cm Modity vs. John Hancock Financial | Cm Modity vs. Fidelity Advisor Financial | Cm Modity vs. Rmb Mendon Financial |
Gmo High vs. Global Real Estate | Gmo High vs. Sa Real Estate | Gmo High vs. Dunham Real Estate | Gmo High vs. Fidelity Real Estate |
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 Portfolio File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
Other Complementary Tools
Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas | |
Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum | |
Global Correlations Find global opportunities by holding instruments from different markets | |
AI Portfolio Prophet Use AI to generate optimal portfolios and find profitable investment opportunities |