Correlation Between Ross Stores and Gaztransport
Can any of the company-specific risk be diversified away by investing in both Ross Stores and Gaztransport 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 Ross Stores and Gaztransport into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ross Stores and Gaztransport et Technigaz, you can compare the effects of market volatilities on Ross Stores and Gaztransport 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 Ross Stores with a short position of Gaztransport. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ross Stores and Gaztransport.
Diversification Opportunities for Ross Stores and Gaztransport
-0.14 | Correlation Coefficient |
Good diversification
The 3 months correlation between Ross and Gaztransport is -0.14. Overlapping area represents the amount of risk that can be diversified away by holding Ross Stores and Gaztransport et Technigaz in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gaztransport et Technigaz and Ross Stores 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 Ross Stores are associated (or correlated) with Gaztransport. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gaztransport et Technigaz has no effect on the direction of Ross Stores i.e., Ross Stores and Gaztransport go up and down completely randomly.
Pair Corralation between Ross Stores and Gaztransport
Assuming the 90 days trading horizon Ross Stores is expected to generate 0.83 times more return on investment than Gaztransport. However, Ross Stores is 1.21 times less risky than Gaztransport. It trades about 0.06 of its potential returns per unit of risk. Gaztransport et Technigaz is currently generating about 0.04 per unit of risk. If you would invest 12,721 in Ross Stores on September 14, 2024 and sell it today you would earn a total of 2,720 from holding Ross Stores or generate 21.38% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.26% |
| Values | Daily Returns |
Ross Stores vs. Gaztransport et Technigaz
Performance |
| Timeline |
| Ross Stores |
| Gaztransport et Technigaz |
Ross Stores and Gaztransport Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ross Stores and Gaztransport
The main advantage of trading using opposite Ross Stores and Gaztransport positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ross Stores position performs unexpectedly, Gaztransport 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 Gaztransport will offset losses from the drop in Gaztransport's long position.| Ross Stores vs. Aurora Investment Trust | Ross Stores vs. GreenX Metals | Ross Stores vs. Cornish Metals | Ross Stores vs. Panther Metals PLC |
| Gaztransport vs. Park Hotels Resorts | Gaztransport vs. Ross Stores | Gaztransport vs. Melia Hotels | Gaztransport vs. Silvercorp Metals |
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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
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