Correlation Between Global Ship and GungHo Online
Can any of the company-specific risk be diversified away by investing in both Global Ship and GungHo Online 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 Global Ship and GungHo Online into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Global Ship Lease and GungHo Online Entertainment, you can compare the effects of market volatilities on Global Ship and GungHo Online 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 Global Ship with a short position of GungHo Online. Check out your portfolio center. Please also check ongoing floating volatility patterns of Global Ship and GungHo Online.
Diversification Opportunities for Global Ship and GungHo Online
-0.03 | Correlation Coefficient |
Good diversification
The 3 months correlation between Global and GungHo is -0.03. Overlapping area represents the amount of risk that can be diversified away by holding Global Ship Lease and GungHo Online Entertainment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GungHo Online Entert and Global Ship 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 Global Ship Lease are associated (or correlated) with GungHo Online. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GungHo Online Entert has no effect on the direction of Global Ship i.e., Global Ship and GungHo Online go up and down completely randomly.
Pair Corralation between Global Ship and GungHo Online
Assuming the 90 days horizon Global Ship Lease is expected to generate 0.82 times more return on investment than GungHo Online. However, Global Ship Lease is 1.22 times less risky than GungHo Online. It trades about 0.06 of its potential returns per unit of risk. GungHo Online Entertainment is currently generating about 0.03 per unit of risk. If you would invest 1,407 in Global Ship Lease on October 13, 2024 and sell it today you would earn a total of 745.00 from holding Global Ship Lease or generate 52.95% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.8% |
| Values | Daily Returns |
Global Ship Lease vs. GungHo Online Entertainment
Performance |
| Timeline |
| Global Ship Lease |
| GungHo Online Entert |
Global Ship and GungHo Online Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Global Ship and GungHo Online
The main advantage of trading using opposite Global Ship and GungHo Online positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Global Ship position performs unexpectedly, GungHo Online 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 GungHo Online will offset losses from the drop in GungHo Online's long position.| Global Ship vs. VULCAN MATERIALS | Global Ship vs. Sumitomo Rubber Industries | Global Ship vs. Q2M Managementberatung AG | Global Ship vs. Corporate Travel Management |
| GungHo Online vs. TOREX SEMICONDUCTOR LTD | GungHo Online vs. United Rentals | GungHo Online vs. Global Ship Lease | GungHo Online vs. Solstad Offshore ASA |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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