Correlation Between GLG LIFE and PKSHA TECHNOLOGY
Can any of the company-specific risk be diversified away by investing in both GLG LIFE and PKSHA 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 GLG LIFE and PKSHA TECHNOLOGY into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between GLG LIFE TECH and PKSHA TECHNOLOGY INC, you can compare the effects of market volatilities on GLG LIFE and PKSHA 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 GLG LIFE with a short position of PKSHA TECHNOLOGY. Check out your portfolio center. Please also check ongoing floating volatility patterns of GLG LIFE and PKSHA TECHNOLOGY.
Diversification Opportunities for GLG LIFE and PKSHA TECHNOLOGY
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between GLG and PKSHA is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding GLG LIFE TECH and PKSHA TECHNOLOGY INC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PKSHA TECHNOLOGY INC and GLG LIFE 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 GLG LIFE TECH are associated (or correlated) with PKSHA TECHNOLOGY. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PKSHA TECHNOLOGY INC has no effect on the direction of GLG LIFE i.e., GLG LIFE and PKSHA TECHNOLOGY go up and down completely randomly.
Pair Corralation between GLG LIFE and PKSHA TECHNOLOGY
If you would invest 2,220 in PKSHA TECHNOLOGY INC on August 30, 2024 and sell it today you would earn a total of 100.00 from holding PKSHA TECHNOLOGY INC or generate 4.5% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
GLG LIFE TECH vs. PKSHA TECHNOLOGY INC
Performance |
| Timeline |
| GLG LIFE TECH |
| PKSHA TECHNOLOGY INC |
GLG LIFE and PKSHA TECHNOLOGY Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GLG LIFE and PKSHA TECHNOLOGY
The main advantage of trading using opposite GLG LIFE and PKSHA TECHNOLOGY positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GLG LIFE position performs unexpectedly, PKSHA 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 PKSHA TECHNOLOGY will offset losses from the drop in PKSHA TECHNOLOGY's long position.| GLG LIFE vs. MITSUBISHI STEEL MFG | GLG LIFE vs. NIPPON STEEL SPADR | GLG LIFE vs. ATOSS SOFTWARE | GLG LIFE vs. Guidewire Software |
| PKSHA TECHNOLOGY vs. Microsoft | PKSHA TECHNOLOGY vs. Adobe Inc | PKSHA TECHNOLOGY vs. Square Inc | PKSHA TECHNOLOGY vs. Adyen NV |
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 Portfolio Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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