Correlation Between Glg Intl and Causeway Global

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

By analyzing existing cross correlation between Glg Intl Small and Causeway Global Value, you can compare the effects of market volatilities on Glg Intl and Causeway Global 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 Glg Intl with a short position of Causeway Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of Glg Intl and Causeway Global.

Diversification Opportunities for Glg Intl and Causeway Global

0.13

Correlation Coefficient

Glg Intl  Causeway Global

Average diversification

The 3 months correlation between Glg and Causeway is 0.13. Overlapping area represents the amount of risk that can be diversified away by holding Glg Intl Small and Causeway Global Value in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Causeway Global Value and Glg Intl 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 Glg Intl Small are associated (or correlated) with Causeway Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Causeway Global Value has no effect on the direction of Glg Intl i.e., Glg Intl and Causeway Global go up and down completely randomly.

Pair Corralation between Glg Intl and Causeway Global

Assuming the 90 days horizon Glg Intl Small is expected to under-perform the Causeway Global. In addition to that, Glg Intl is 1.33 times more volatile than Causeway Global Value. It trades about -0.02 of its total potential returns per unit of risk. Causeway Global Value is currently generating about 0.12 per unit of volatility. If you would invest  1,259  in Causeway Global Value on December 26, 2024 and sell it today you would earn a total of  77.00  from holding Causeway Global Value or generate 6.12% return on investment over 90 days.

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

Glg Intl Small  vs.  Causeway Global Value

Glg Intl Small

Risk-Adjusted Performance

Very Weak

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

Causeway Global Value

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Causeway Global Value are ranked lower than 9 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak forward indicators, Causeway Global may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Pair Trading with Glg Intl and Causeway Global

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

The idea behind Glg Intl Small and Causeway Global Value 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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.