Correlation Between Gigastorage Corp and Promise Technology
Can any of the company-specific risk be diversified away by investing in both Gigastorage Corp and Promise Technology 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 Gigastorage Corp and Promise Technology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Gigastorage Corp and Promise Technology, you can compare the effects of market volatilities on Gigastorage Corp and Promise Technology 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 Gigastorage Corp with a short position of Promise Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gigastorage Corp and Promise Technology.
Diversification Opportunities for Gigastorage Corp and Promise Technology
0.23 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Gigastorage and Promise is 0.23. Overlapping area represents the amount of risk that can be diversified away by holding Gigastorage Corp and Promise Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Promise Technology and Gigastorage Corp 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 Gigastorage Corp are associated (or correlated) with Promise Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Promise Technology has no effect on the direction of Gigastorage Corp i.e., Gigastorage Corp and Promise Technology go up and down completely randomly.
Pair Corralation between Gigastorage Corp and Promise Technology
Assuming the 90 days trading horizon Gigastorage Corp is expected to generate 1.64 times more return on investment than Promise Technology. However, Gigastorage Corp is 1.64 times more volatile than Promise Technology. It trades about -0.18 of its potential returns per unit of risk. Promise Technology is currently generating about -0.36 per unit of risk. If you would invest 1,835 in Gigastorage Corp on September 1, 2024 and sell it today you would lose (155.00) from holding Gigastorage Corp or give up 8.45% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Gigastorage Corp vs. Promise Technology
Performance |
| Timeline |
| Gigastorage Corp |
| Promise Technology |
Gigastorage Corp and Promise Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Gigastorage Corp and Promise Technology
The main advantage of trading using opposite Gigastorage Corp and Promise Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gigastorage Corp position performs unexpectedly, Promise Technology 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 Promise Technology will offset losses from the drop in Promise Technology's long position.The idea behind Gigastorage Corp and Promise Technology 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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
Other Complementary Tools
| Earnings Calls Check upcoming earnings announcements updated hourly across public exchanges | |
| Pattern Recognition Use different Pattern Recognition models to time the market across multiple global exchanges | |
| Portfolio Manager State of the art Portfolio Manager to monitor and improve performance of your invested capital | |
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets | |
| Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas |