Correlation Between G5 Entertainment and Systemair
Can any of the company-specific risk be diversified away by investing in both G5 Entertainment and Systemair 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 G5 Entertainment and Systemair into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between G5 Entertainment AB and Systemair AB, you can compare the effects of market volatilities on G5 Entertainment and Systemair 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 G5 Entertainment with a short position of Systemair. Check out your portfolio center. Please also check ongoing floating volatility patterns of G5 Entertainment and Systemair.
Diversification Opportunities for G5 Entertainment and Systemair
0.58 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between 0QUS and Systemair is 0.58. Overlapping area represents the amount of risk that can be diversified away by holding G5 Entertainment AB and Systemair AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Systemair AB and G5 Entertainment 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 G5 Entertainment AB are associated (or correlated) with Systemair. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Systemair AB has no effect on the direction of G5 Entertainment i.e., G5 Entertainment and Systemair go up and down completely randomly.
Pair Corralation between G5 Entertainment and Systemair
Assuming the 90 days trading horizon G5 Entertainment AB is expected to generate 0.95 times more return on investment than Systemair. However, G5 Entertainment AB is 1.06 times less risky than Systemair. It trades about 0.06 of its potential returns per unit of risk. Systemair AB is currently generating about 0.06 per unit of risk. If you would invest 10,840 in G5 Entertainment AB on October 11, 2024 and sell it today you would earn a total of 540.00 from holding G5 Entertainment AB or generate 4.98% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
G5 Entertainment AB vs. Systemair AB
Performance |
| Timeline |
| G5 Entertainment |
| Systemair AB |
G5 Entertainment and Systemair Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with G5 Entertainment and Systemair
The main advantage of trading using opposite G5 Entertainment and Systemair positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if G5 Entertainment position performs unexpectedly, Systemair 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 Systemair will offset losses from the drop in Systemair's long position.| G5 Entertainment vs. Waste Management | G5 Entertainment vs. JB Hunt Transport | G5 Entertainment vs. Roebuck Food Group | G5 Entertainment vs. Travel Leisure Co |
| Systemair vs. InterContinental Hotels Group | Systemair vs. Science in Sport | Systemair vs. Grieg Seafood | Systemair vs. Tyson Foods Cl |
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 Portfolio Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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