Correlation Between Clough Global and Brandywineglobal

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

By analyzing existing cross correlation between Clough Global Opportunities and Brandywineglobal Globalome Opportunities, you can compare the effects of market volatilities on Clough Global and Brandywineglobal 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 Clough Global with a short position of Brandywineglobal. Check out your portfolio center. Please also check ongoing floating volatility patterns of Clough Global and Brandywineglobal.

Diversification Opportunities for Clough Global and Brandywineglobal

0.69

Correlation Coefficient

Clough Global  Brandywineglobal

Poor diversification

The 3 months correlation between Clough and Brandywineglobal is 0.69. Overlapping area represents the amount of risk that can be diversified away by holding Clough Global Opportunities and Brandywineglobal Globalome Opp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Brandywineglobal Glo and Clough Global 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 Clough Global Opportunities are associated (or correlated) with Brandywineglobal. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Brandywineglobal Glo has no effect on the direction of Clough Global i.e., Clough Global and Brandywineglobal go up and down completely randomly.

Pair Corralation between Clough Global and Brandywineglobal

Considering the 90-day investment horizon Clough Global Opportunities is expected to under-perform the Brandywineglobal. In addition to that, Clough Global is 1.71 times more volatile than Brandywineglobal Globalome Opportunities. It trades about -0.11 of its total potential returns per unit of risk. Brandywineglobal Globalome Opportunities is currently generating about 0.28 per unit of volatility. If you would invest  821.00  in Brandywineglobal Globalome Opportunities on November 29, 2024 and sell it today you would earn a total of  24.00  from holding Brandywineglobal Globalome Opportunities or generate 2.92% return on investment over 90 days.

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

Clough Global Opportunities  vs.  Brandywineglobal Globalome Opp

Clough Global Opport

Risk-Adjusted Performance

Very Weak

Over the last 90 days Clough Global Opportunities has generated negative risk-adjusted returns adding no value to fund investors. In spite of very healthy essential indicators, Clough Global is not utilizing all of its potentials. The latest stock price disarray, may contribute to short-term losses for the investors.

Brandywineglobal Glo

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Brandywineglobal Globalome Opportunities are ranked lower than 5 (%) of all funds and portfolios of funds over the last 90 days. Despite nearly stable basic indicators, Brandywineglobal is not utilizing all of its potentials. The recent stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with Clough Global and Brandywineglobal

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

The idea behind Clough Global Opportunities and Brandywineglobal Globalome Opportunities 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 Portfolio File Import module to quickly import all of your third-party portfolios from your local drive in csv format.