Correlation Between Gurtin California and Cliffwater Corporate

Can any of the company-specific risk be diversified away by investing in both Gurtin California and Cliffwater Corporate 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 Gurtin California and Cliffwater Corporate into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Gurtin California Muni and Cliffwater Corporate Lending, you can compare the effects of market volatilities on Gurtin California and Cliffwater Corporate 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 Gurtin California with a short position of Cliffwater Corporate. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gurtin California and Cliffwater Corporate.

Diversification Opportunities for Gurtin California and Cliffwater Corporate

-0.05

Correlation Coefficient

Gurtin California  Cliffwater Corporate

Good diversification

The 3 months correlation between Gurtin and Cliffwater is -0.05. Overlapping area represents the amount of risk that can be diversified away by holding Gurtin California Muni and Cliffwater Corporate Lending in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cliffwater Corporate and Gurtin California 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 Gurtin California Muni are associated (or correlated) with Cliffwater Corporate. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cliffwater Corporate has no effect on the direction of Gurtin California i.e., Gurtin California and Cliffwater Corporate go up and down completely randomly.

Pair Corralation between Gurtin California and Cliffwater Corporate

Assuming the 90 days horizon Gurtin California is expected to generate 11.29 times less return on investment than Cliffwater Corporate. In addition to that, Gurtin California is 3.38 times more volatile than Cliffwater Corporate Lending. It trades about 0.02 of its total potential returns per unit of risk. Cliffwater Corporate Lending is currently generating about 0.79 per unit of volatility. If you would invest  1,042  in Cliffwater Corporate Lending on October 23, 2024 and sell it today you would earn a total of  25.00  from holding Cliffwater Corporate Lending or generate 2.4% return on investment over 90 days.

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

Gurtin California Muni  vs.  Cliffwater Corporate Lending

Gurtin California Muni

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Gurtin California Muni are ranked lower than 1 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong basic indicators, Gurtin California is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Cliffwater Corporate

Risk-Adjusted Performance

61 of 100

Market Crasher

Compared to the overall equity markets, risk-adjusted returns on investments in Cliffwater Corporate Lending are ranked lower than 61 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong technical and fundamental indicators, Cliffwater Corporate is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Gurtin California and Cliffwater Corporate

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

The idea behind Gurtin California Muni and Cliffwater Corporate Lending 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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.