Correlation Between Gmo Asset and Tanaka Growth

Can any of the company-specific risk be diversified away by investing in both Gmo Asset and Tanaka Growth 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 Gmo Asset and Tanaka Growth into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Gmo Asset Allocation and Tanaka Growth Fund, you can compare the effects of market volatilities on Gmo Asset and Tanaka Growth 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 Gmo Asset with a short position of Tanaka Growth. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gmo Asset and Tanaka Growth.

Diversification Opportunities for Gmo Asset and Tanaka Growth

0.0

Correlation Coefficient

Gmo Asset  Tanaka Growth

Pay attention - limited upside

The 3 months correlation between Gmo and Tanaka is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Gmo Asset Allocation and Tanaka Growth Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tanaka Growth and Gmo Asset 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 Gmo Asset Allocation are associated (or correlated) with Tanaka Growth. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tanaka Growth has no effect on the direction of Gmo Asset i.e., Gmo Asset and Tanaka Growth go up and down completely randomly.

Pair Corralation between Gmo Asset and Tanaka Growth

If you would invest  0.00  in Tanaka Growth Fund on September 22, 2024 and sell it today you would earn a total of  0.00  from holding Tanaka Growth Fund or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	4.76%
Values	Daily Returns

Gmo Asset Allocation  vs.  Tanaka Growth Fund

Gmo Asset Allocation

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Gmo Asset Allocation has generated negative risk-adjusted returns adding no value to fund investors. In spite of weak performance in the last few months, the Fund's technical and fundamental indicators remain fairly strong which may send shares a bit higher in January 2025. The current disturbance may also be a sign of long term up-swing for the fund investors.

Tanaka Growth

Risk-Adjusted Performance

0 of 100

Modest

Over the last 90 days Tanaka Growth Fund has generated negative risk-adjusted returns adding no value to fund investors. In spite of fairly strong basic indicators, Tanaka Growth is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Gmo Asset and Tanaka Growth

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

The idea behind Gmo Asset Allocation and Tanaka Growth Fund 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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.