Correlation Between Gaztransport and Baillie Gifford

Specify exactly 2 symbols:
Can any of the company-specific risk be diversified away by investing in both Gaztransport and Baillie Gifford 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 Baillie Gifford 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 Baillie Gifford European, you can compare the effects of market volatilities on Gaztransport and Baillie Gifford 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 Baillie Gifford. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gaztransport and Baillie Gifford.

Diversification Opportunities for Gaztransport and Baillie Gifford

-0.83
  Correlation Coefficient

Pay attention - limited upside

The 3 months correlation between Gaztransport and Baillie is -0.83. Overlapping area represents the amount of risk that can be diversified away by holding Gaztransport et Technigaz and Baillie Gifford European in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Baillie Gifford European 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 Baillie Gifford. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Baillie Gifford European has no effect on the direction of Gaztransport i.e., Gaztransport and Baillie Gifford go up and down completely randomly.

Pair Corralation between Gaztransport and Baillie Gifford

Assuming the 90 days trading horizon Gaztransport et Technigaz is expected to generate 1.51 times more return on investment than Baillie Gifford. However, Gaztransport is 1.51 times more volatile than Baillie Gifford European. It trades about 0.05 of its potential returns per unit of risk. Baillie Gifford European is currently generating about 0.01 per unit of risk. If you would invest  9,366  in Gaztransport et Technigaz on September 20, 2024 and sell it today you would earn a total of  3,709  from holding Gaztransport et Technigaz or generate 39.6% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthSignificant
Accuracy100.0%
ValuesDaily Returns

Gaztransport et Technigaz  vs.  Baillie Gifford European

 Performance 
       Timeline  
Gaztransport et Technigaz 

Risk-Adjusted Performance

4 of 100

 
Weak
 
Strong
Insignificant
Compared to the overall equity markets, risk-adjusted returns on investments in Gaztransport et Technigaz are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively stable basic indicators, Gaztransport is not utilizing all of its potentials. The newest stock price uproar, may contribute to short-horizon losses for the private investors.
Baillie Gifford European 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days Baillie Gifford European has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, Baillie Gifford is not utilizing all of its potentials. The newest stock price uproar, may contribute to short-horizon losses for the private investors.

Gaztransport and Baillie Gifford Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Gaztransport and Baillie Gifford

The main advantage of trading using opposite Gaztransport and Baillie Gifford positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gaztransport position performs unexpectedly, Baillie Gifford 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 Baillie Gifford will offset losses from the drop in Baillie Gifford's long position.
The idea behind Gaztransport et Technigaz and Baillie Gifford European 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.
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.

Other Complementary Tools

Portfolio Comparator
Compare the composition, asset allocations and performance of any two portfolios in your account
CEOs Directory
Screen CEOs from public companies around the world
Analyst Advice
Analyst recommendations and target price estimates broken down by several categories
Piotroski F Score
Get Piotroski F Score based on the binary analysis strategy of nine different fundamentals
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