Correlation Between AlzChem Group and GBS Software
Can any of the company-specific risk be diversified away by investing in both AlzChem Group and GBS Software 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 AlzChem Group and GBS Software into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AlzChem Group AG and GBS Software AG, you can compare the effects of market volatilities on AlzChem Group and GBS Software 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 AlzChem Group with a short position of GBS Software. Check out your portfolio center. Please also check ongoing floating volatility patterns of AlzChem Group and GBS Software.
Diversification Opportunities for AlzChem Group and GBS Software
0.61 | Correlation Coefficient |
Poor diversification
The 3 months correlation between AlzChem and GBS is 0.61. Overlapping area represents the amount of risk that can be diversified away by holding AlzChem Group AG and GBS Software AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GBS Software AG and AlzChem Group 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 AlzChem Group AG are associated (or correlated) with GBS Software. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GBS Software AG has no effect on the direction of AlzChem Group i.e., AlzChem Group and GBS Software go up and down completely randomly.
Pair Corralation between AlzChem Group and GBS Software
If you would invest 262.00 in GBS Software AG on October 28, 2024 and sell it today you would earn a total of 42.00 from holding GBS Software AG or generate 16.03% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 5.0% |
| Values | Daily Returns |
AlzChem Group AG vs. GBS Software AG
Performance |
| Timeline |
| AlzChem Group AG |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
OK
| GBS Software AG |
AlzChem Group and GBS Software Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AlzChem Group and GBS Software
The main advantage of trading using opposite AlzChem Group and GBS Software positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AlzChem Group position performs unexpectedly, GBS Software 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 GBS Software will offset losses from the drop in GBS Software's long position.| AlzChem Group vs. OPERA SOFTWARE | AlzChem Group vs. CHINA EDUCATION GROUP | AlzChem Group vs. Perdoceo Education | AlzChem Group vs. Laureate Education |
| GBS Software vs. Live Nation Entertainment | GBS Software vs. PROSIEBENSAT1 MEDIADR4 | GBS Software vs. PENN Entertainment | GBS Software vs. Darden Restaurants |
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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
Other Complementary Tools
| Watchlist Optimization Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm | |
| Fundamental Analysis View fundamental data based on most recent published financial statements | |
| Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum | |
| Funds Screener Find actively-traded funds from around the world traded on over 30 global exchanges | |
| Global Correlations Find global opportunities by holding instruments from different markets |