Correlation Between Gaztransport Technigaz and WI LAN
Can any of the company-specific risk be diversified away by investing in both Gaztransport Technigaz and WI LAN 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 WI LAN 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 WI LAN, you can compare the effects of market volatilities on Gaztransport Technigaz and WI LAN 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 WI LAN. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gaztransport Technigaz and WI LAN.
Diversification Opportunities for Gaztransport Technigaz and WI LAN
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Gaztransport and WJL is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Gaztransport Technigaz SA and WI LAN in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on WI LAN 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 WI LAN. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of WI LAN has no effect on the direction of Gaztransport Technigaz i.e., Gaztransport Technigaz and WI LAN go up and down completely randomly.
Pair Corralation between Gaztransport Technigaz and WI LAN
Assuming the 90 days horizon Gaztransport Technigaz SA is expected to generate 0.45 times more return on investment than WI LAN. However, Gaztransport Technigaz SA is 2.23 times less risky than WI LAN. It trades about 0.19 of its potential returns per unit of risk. WI LAN is currently generating about -0.02 per unit of risk. If you would invest 13,250 in Gaztransport Technigaz SA on August 27, 2024 and sell it today you would earn a total of 890.00 from holding Gaztransport Technigaz SA or generate 6.72% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Gaztransport Technigaz SA vs. WI LAN
Performance |
| Timeline |
| Gaztransport Technigaz |
| WI LAN |
Gaztransport Technigaz and WI LAN Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Gaztransport Technigaz and WI LAN
The main advantage of trading using opposite Gaztransport Technigaz and WI LAN positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gaztransport Technigaz position performs unexpectedly, WI LAN 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 WI LAN will offset losses from the drop in WI LAN's long position.The idea behind Gaztransport Technigaz SA and WI LAN pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
| WI LAN vs. Gaztransport Technigaz SA | WI LAN vs. United Airlines Holdings | WI LAN vs. Sporttotal AG | WI LAN vs. AEGEAN AIRLINES |
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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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