Correlation Between Gotham Total and First Trust

Can any of the company-specific risk be diversified away by investing in both Gotham Total and First Trust 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 Gotham Total and First Trust into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Gotham Total Return and First Trust Exchange Traded, you can compare the effects of market volatilities on Gotham Total and First Trust 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 Gotham Total with a short position of First Trust. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gotham Total and First Trust.

Diversification Opportunities for Gotham Total and First Trust

-0.16

Correlation Coefficient

Gotham Total  First Trust

Good diversification

The 3 months correlation between Gotham and First is -0.16. Overlapping area represents the amount of risk that can be diversified away by holding Gotham Total Return and First Trust Exchange Traded in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on First Trust Exchange and Gotham Total 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 Gotham Total Return are associated (or correlated) with First Trust. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of First Trust Exchange has no effect on the direction of Gotham Total i.e., Gotham Total and First Trust go up and down completely randomly.

Pair Corralation between Gotham Total and First Trust

Assuming the 90 days horizon Gotham Total Return is expected to generate 0.28 times more return on investment than First Trust. However, Gotham Total Return is 3.52 times less risky than First Trust. It trades about 0.11 of its potential returns per unit of risk. First Trust Exchange Traded is currently generating about -0.02 per unit of risk. If you would invest  1,385  in Gotham Total Return on July 27, 2025 and sell it today you would earn a total of  36.00  from holding Gotham Total Return or generate 2.6% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Gotham Total Return  vs.  First Trust Exchange Traded

Gotham Total Return

Risk-Adjusted Performance

Fair

Compared to the overall equity markets, risk-adjusted returns on investments in Gotham Total Return are ranked lower than 9 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong technical and fundamental indicators, Gotham Total is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

First Trust Exchange

Risk-Adjusted Performance

Weakest

Over the last 90 days First Trust Exchange Traded has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fairly strong forward indicators, First Trust is not utilizing all of its potentials. The current stock price confusion, may contribute to short-horizon losses for the traders.

Pair Trading with Gotham Total and First Trust

The main advantage of trading using opposite Gotham Total and First Trust positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gotham Total position performs unexpectedly, First Trust 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 First Trust will offset losses from the drop in First Trust's long position.

The idea behind Gotham Total Return and First Trust Exchange Traded pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.