Correlation Between Gaztransport Technigaz and KEPPEL CORP
Can any of the company-specific risk be diversified away by investing in both Gaztransport Technigaz and KEPPEL CORP 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 KEPPEL CORP 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 KEPPEL P , you can compare the effects of market volatilities on Gaztransport Technigaz and KEPPEL CORP 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 KEPPEL CORP. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gaztransport Technigaz and KEPPEL CORP.
Diversification Opportunities for Gaztransport Technigaz and KEPPEL CORP
0.31 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Gaztransport and KEPPEL is 0.31. Overlapping area represents the amount of risk that can be diversified away by holding Gaztransport Technigaz SA and KEPPEL P in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on KEPPEL CORP 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 KEPPEL CORP. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of KEPPEL CORP has no effect on the direction of Gaztransport Technigaz i.e., Gaztransport Technigaz and KEPPEL CORP go up and down completely randomly.
Pair Corralation between Gaztransport Technigaz and KEPPEL CORP
Assuming the 90 days horizon Gaztransport Technigaz SA is expected to generate 1.44 times more return on investment than KEPPEL CORP. However, Gaztransport Technigaz is 1.44 times more volatile than KEPPEL P . It trades about 0.09 of its potential returns per unit of risk. KEPPEL P is currently generating about 0.05 per unit of risk. If you would invest 8,818 in Gaztransport Technigaz SA on August 28, 2024 and sell it today you would earn a total of 5,322 from holding Gaztransport Technigaz SA or generate 60.35% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Gaztransport Technigaz SA vs. KEPPEL P
Performance |
| Timeline |
| Gaztransport Technigaz |
| KEPPEL CORP |
Gaztransport Technigaz and KEPPEL CORP Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Gaztransport Technigaz and KEPPEL CORP
The main advantage of trading using opposite Gaztransport Technigaz and KEPPEL CORP positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gaztransport Technigaz position performs unexpectedly, KEPPEL CORP 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 KEPPEL CORP will offset losses from the drop in KEPPEL CORP's long position.| Gaztransport Technigaz vs. CompuGroup Medical SE | Gaztransport Technigaz vs. Apollo Medical Holdings | Gaztransport Technigaz vs. Clearside Biomedical | Gaztransport Technigaz vs. MEDICAL FACILITIES NEW |
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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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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