Correlation Between Gladstone Investment and REGAL ASIAN
Can any of the company-specific risk be diversified away by investing in both Gladstone Investment and REGAL ASIAN 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 Gladstone Investment and REGAL ASIAN into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Gladstone Investment and REGAL ASIAN INVESTMENTS, you can compare the effects of market volatilities on Gladstone Investment and REGAL ASIAN 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 Gladstone Investment with a short position of REGAL ASIAN. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gladstone Investment and REGAL ASIAN.
Diversification Opportunities for Gladstone Investment and REGAL ASIAN
0.86 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Gladstone and REGAL is 0.86. Overlapping area represents the amount of risk that can be diversified away by holding Gladstone Investment and REGAL ASIAN INVESTMENTS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on REGAL ASIAN INVESTMENTS and Gladstone Investment 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 Gladstone Investment are associated (or correlated) with REGAL ASIAN. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of REGAL ASIAN INVESTMENTS has no effect on the direction of Gladstone Investment i.e., Gladstone Investment and REGAL ASIAN go up and down completely randomly.
Pair Corralation between Gladstone Investment and REGAL ASIAN
Assuming the 90 days horizon Gladstone Investment is expected to generate 1.45 times more return on investment than REGAL ASIAN. However, Gladstone Investment is 1.45 times more volatile than REGAL ASIAN INVESTMENTS. It trades about 0.1 of its potential returns per unit of risk. REGAL ASIAN INVESTMENTS is currently generating about -0.24 per unit of risk. If you would invest 1,246 in Gladstone Investment on September 1, 2024 and sell it today you would earn a total of 55.00 from holding Gladstone Investment or generate 4.41% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Gladstone Investment vs. REGAL ASIAN INVESTMENTS
Performance |
| Timeline |
| Gladstone Investment |
| REGAL ASIAN INVESTMENTS |
Gladstone Investment and REGAL ASIAN Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Gladstone Investment and REGAL ASIAN
The main advantage of trading using opposite Gladstone Investment and REGAL ASIAN positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gladstone Investment position performs unexpectedly, REGAL ASIAN 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 REGAL ASIAN will offset losses from the drop in REGAL ASIAN's long position.| Gladstone Investment vs. MINCO SILVER | Gladstone Investment vs. Perdoceo Education | Gladstone Investment vs. Grand Canyon Education | Gladstone Investment vs. RYU Apparel |
| REGAL ASIAN vs. PennantPark Investment | REGAL ASIAN vs. SEI INVESTMENTS | REGAL ASIAN vs. MARKET VECTR RETAIL | REGAL ASIAN vs. Strategic Investments AS |
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.
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