Correlation Between Gaztransport and Alfa Financial
Can any of the company-specific risk be diversified away by investing in both Gaztransport and Alfa Financial 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 Gaztransport and Alfa Financial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Gaztransport et Technigaz and Alfa Financial Software, you can compare the effects of market volatilities on Gaztransport and Alfa Financial 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 Gaztransport with a short position of Alfa Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gaztransport and Alfa Financial.
Diversification Opportunities for Gaztransport and Alfa Financial
-0.53 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Gaztransport and Alfa is -0.53. Overlapping area represents the amount of risk that can be diversified away by holding Gaztransport et Technigaz and Alfa Financial Software in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Alfa Financial Software and Gaztransport 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 Gaztransport et Technigaz are associated (or correlated) with Alfa Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Alfa Financial Software has no effect on the direction of Gaztransport i.e., Gaztransport and Alfa Financial go up and down completely randomly.
Pair Corralation between Gaztransport and Alfa Financial
Assuming the 90 days trading horizon Gaztransport et Technigaz is expected to generate 0.72 times more return on investment than Alfa Financial. However, Gaztransport et Technigaz is 1.39 times less risky than Alfa Financial. It trades about 0.13 of its potential returns per unit of risk. Alfa Financial Software is currently generating about -0.06 per unit of risk. If you would invest 13,163 in Gaztransport et Technigaz on October 30, 2024 and sell it today you would earn a total of 1,367 from holding Gaztransport et Technigaz or generate 10.39% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Gaztransport et Technigaz vs. Alfa Financial Software
Performance |
| Timeline |
| Gaztransport et Technigaz |
| Alfa Financial Software |
Gaztransport and Alfa Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Gaztransport and Alfa Financial
The main advantage of trading using opposite Gaztransport and Alfa Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gaztransport position performs unexpectedly, Alfa Financial 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 Alfa Financial will offset losses from the drop in Alfa Financial's long position.| Gaztransport vs. Vulcan Materials Co | Gaztransport vs. Eastinco Mining Exploration | Gaztransport vs. Adriatic Metals | Gaztransport vs. Cornish Metals |
| Alfa Financial vs. Lindsell Train Investment | Alfa Financial vs. Wheaton Precious Metals | Alfa Financial vs. Ion Beam Applications | Alfa Financial vs. Air Products Chemicals |
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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
Other Complementary Tools
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine | |
| Portfolio Dashboard Portfolio dashboard that provides centralized access to all your investments | |
| Portfolio Center All portfolio management and optimization tools to improve performance of your portfolios | |
| Technical Analysis Check basic technical indicators and analysis based on most latest market data | |
| Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities |