Correlation Between GFL ENVIRONM and Hologic
Can any of the company-specific risk be diversified away by investing in both GFL ENVIRONM and Hologic 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 GFL ENVIRONM and Hologic into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between GFL ENVIRONM and Hologic, you can compare the effects of market volatilities on GFL ENVIRONM and Hologic 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 GFL ENVIRONM with a short position of Hologic. Check out your portfolio center. Please also check ongoing floating volatility patterns of GFL ENVIRONM and Hologic.
Diversification Opportunities for GFL ENVIRONM and Hologic
0.54 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between GFL and Hologic is 0.54. Overlapping area represents the amount of risk that can be diversified away by holding GFL ENVIRONM and Hologic in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hologic and GFL ENVIRONM 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 GFL ENVIRONM are associated (or correlated) with Hologic. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hologic has no effect on the direction of GFL ENVIRONM i.e., GFL ENVIRONM and Hologic go up and down completely randomly.
Pair Corralation between GFL ENVIRONM and Hologic
Assuming the 90 days horizon GFL ENVIRONM is expected to generate 1.64 times more return on investment than Hologic. However, GFL ENVIRONM is 1.64 times more volatile than Hologic. It trades about 0.12 of its potential returns per unit of risk. Hologic is currently generating about 0.02 per unit of risk. If you would invest 3,899 in GFL ENVIRONM on September 3, 2024 and sell it today you would earn a total of 501.00 from holding GFL ENVIRONM or generate 12.85% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
GFL ENVIRONM vs. Hologic
Performance |
| Timeline |
| GFL ENVIRONM |
| Hologic |
GFL ENVIRONM and Hologic Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GFL ENVIRONM and Hologic
The main advantage of trading using opposite GFL ENVIRONM and Hologic positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GFL ENVIRONM position performs unexpectedly, Hologic 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 Hologic will offset losses from the drop in Hologic's long position.| GFL ENVIRONM vs. TIANDE CHEMICAL | GFL ENVIRONM vs. PennyMac Mortgage Investment | GFL ENVIRONM vs. KINGBOARD CHEMICAL | GFL ENVIRONM vs. SEI INVESTMENTS |
| Hologic vs. NIPPON STEEL SPADR | Hologic vs. Citic Telecom International | Hologic vs. Khiron Life Sciences | Hologic vs. GFL ENVIRONM |
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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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