Correlation Between Gaztransport Technigaz and ONWARD MEDICAL
Can any of the company-specific risk be diversified away by investing in both Gaztransport Technigaz and ONWARD MEDICAL 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 Gaztransport Technigaz and ONWARD MEDICAL into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Gaztransport Technigaz SA and ONWARD MEDICAL BV, you can compare the effects of market volatilities on Gaztransport Technigaz and ONWARD MEDICAL 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 Gaztransport Technigaz with a short position of ONWARD MEDICAL. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gaztransport Technigaz and ONWARD MEDICAL.
Diversification Opportunities for Gaztransport Technigaz and ONWARD MEDICAL
0.4 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Gaztransport and ONWARD is 0.4. Overlapping area represents the amount of risk that can be diversified away by holding Gaztransport Technigaz SA and ONWARD MEDICAL BV in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ONWARD MEDICAL BV and Gaztransport Technigaz 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 Gaztransport Technigaz SA are associated (or correlated) with ONWARD MEDICAL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ONWARD MEDICAL BV has no effect on the direction of Gaztransport Technigaz i.e., Gaztransport Technigaz and ONWARD MEDICAL go up and down completely randomly.
Pair Corralation between Gaztransport Technigaz and ONWARD MEDICAL
Assuming the 90 days horizon Gaztransport Technigaz is expected to generate 2.78 times less return on investment than ONWARD MEDICAL. But when comparing it to its historical volatility, Gaztransport Technigaz SA is 1.98 times less risky than ONWARD MEDICAL. It trades about 0.07 of its potential returns per unit of risk. ONWARD MEDICAL BV is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 475.00 in ONWARD MEDICAL BV on October 26, 2024 and sell it today you would earn a total of 189.00 from holding ONWARD MEDICAL BV or generate 39.79% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Gaztransport Technigaz SA vs. ONWARD MEDICAL BV
Performance |
| Timeline |
| Gaztransport Technigaz |
| ONWARD MEDICAL BV |
Gaztransport Technigaz and ONWARD MEDICAL Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Gaztransport Technigaz and ONWARD MEDICAL
The main advantage of trading using opposite Gaztransport Technigaz and ONWARD MEDICAL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gaztransport Technigaz position performs unexpectedly, ONWARD MEDICAL 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 ONWARD MEDICAL will offset losses from the drop in ONWARD MEDICAL's long position.| Gaztransport Technigaz vs. ALERION CLEANPOWER | Gaztransport Technigaz vs. Coffee Holding Co | Gaztransport Technigaz vs. Ultra Clean Holdings | Gaztransport Technigaz vs. Amkor Technology |
| ONWARD MEDICAL vs. DICKS Sporting Goods | ONWARD MEDICAL vs. MOUNT GIBSON IRON | ONWARD MEDICAL vs. Gaztransport Technigaz SA | ONWARD MEDICAL vs. BII Railway Transportation |
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 Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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