Correlation Between GB Group and Scottish Mortgage
Can any of the company-specific risk be diversified away by investing in both GB Group and Scottish Mortgage 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 GB Group and Scottish Mortgage into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between GB Group plc and Scottish Mortgage Investment, you can compare the effects of market volatilities on GB Group and Scottish Mortgage 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 GB Group with a short position of Scottish Mortgage. Check out your portfolio center. Please also check ongoing floating volatility patterns of GB Group and Scottish Mortgage.
Diversification Opportunities for GB Group and Scottish Mortgage
0.49 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between 0GB and Scottish is 0.49. Overlapping area represents the amount of risk that can be diversified away by holding GB Group plc and Scottish Mortgage Investment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Scottish Mortgage and GB Group 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 GB Group plc are associated (or correlated) with Scottish Mortgage. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Scottish Mortgage has no effect on the direction of GB Group i.e., GB Group and Scottish Mortgage go up and down completely randomly.
Pair Corralation between GB Group and Scottish Mortgage
Assuming the 90 days horizon GB Group is expected to generate 11.61 times less return on investment than Scottish Mortgage. In addition to that, GB Group is 1.58 times more volatile than Scottish Mortgage Investment. It trades about 0.01 of its total potential returns per unit of risk. Scottish Mortgage Investment is currently generating about 0.12 per unit of volatility. If you would invest 1,010 in Scottish Mortgage Investment on October 25, 2024 and sell it today you would earn a total of 229.00 from holding Scottish Mortgage Investment or generate 22.67% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
GB Group plc vs. Scottish Mortgage Investment
Performance |
| Timeline |
| GB Group plc |
| Scottish Mortgage |
GB Group and Scottish Mortgage Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GB Group and Scottish Mortgage
The main advantage of trading using opposite GB Group and Scottish Mortgage positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GB Group position performs unexpectedly, Scottish Mortgage 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 Scottish Mortgage will offset losses from the drop in Scottish Mortgage's long position.| GB Group vs. AGNC INVESTMENT | GB Group vs. Nishi Nippon Railroad Co | GB Group vs. WisdomTree Investments | GB Group vs. Apollo Investment Corp |
| Scottish Mortgage vs. FIRST SAVINGS FINL | Scottish Mortgage vs. PennyMac Mortgage Investment | Scottish Mortgage vs. Gruppo Mutuionline SpA | Scottish Mortgage vs. MUTUIONLINE |
Check out your portfolio center.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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
Other Complementary Tools
| Portfolio Comparator Compare the composition, asset allocations and performance of any two portfolios in your account | |
| My Watchlist Analysis Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like | |
| Headlines Timeline Stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity | |
| Piotroski F Score Get Piotroski F Score based on the binary analysis strategy of nine different fundamentals | |
| Volatility Analysis Get historical volatility and risk analysis based on latest market data |