Correlation Between Grand Ocean and Launch Technologies
Can any of the company-specific risk be diversified away by investing in both Grand Ocean and Launch Technologies 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 Grand Ocean and Launch Technologies into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Grand Ocean Retail and Launch Technologies Co, you can compare the effects of market volatilities on Grand Ocean and Launch Technologies 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 Grand Ocean with a short position of Launch Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of Grand Ocean and Launch Technologies.
Diversification Opportunities for Grand Ocean and Launch Technologies
-0.57 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Grand and Launch is -0.57. Overlapping area represents the amount of risk that can be diversified away by holding Grand Ocean Retail and Launch Technologies Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Launch Technologies and Grand Ocean 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 Grand Ocean Retail are associated (or correlated) with Launch Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Launch Technologies has no effect on the direction of Grand Ocean i.e., Grand Ocean and Launch Technologies go up and down completely randomly.
Pair Corralation between Grand Ocean and Launch Technologies
Assuming the 90 days trading horizon Grand Ocean Retail is expected to generate 1.17 times more return on investment than Launch Technologies. However, Grand Ocean is 1.17 times more volatile than Launch Technologies Co. It trades about -0.01 of its potential returns per unit of risk. Launch Technologies Co is currently generating about -0.05 per unit of risk. If you would invest 1,715 in Grand Ocean Retail on September 14, 2024 and sell it today you would lose (415.00) from holding Grand Ocean Retail or give up 24.2% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 98.12% |
| Values | Daily Returns |
Grand Ocean Retail vs. Launch Technologies Co
Performance |
| Timeline |
| Grand Ocean Retail |
| Launch Technologies |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Grand Ocean and Launch Technologies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Grand Ocean and Launch Technologies
The main advantage of trading using opposite Grand Ocean and Launch Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Grand Ocean position performs unexpectedly, Launch Technologies 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 Launch Technologies will offset losses from the drop in Launch Technologies' long position.| Grand Ocean vs. Feng Tay Enterprises | Grand Ocean vs. Ruentex Development Co | Grand Ocean vs. WiseChip Semiconductor | Grand Ocean vs. Novatek Microelectronics Corp |
| Launch Technologies vs. Grand Ocean Retail | Launch Technologies vs. HIM International Music | Launch Technologies vs. Pacific Construction Co | Launch Technologies vs. New Asia Construction |
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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
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