Correlation Between Gaussin and Glob Bioenergi
Can any of the company-specific risk be diversified away by investing in both Gaussin and Glob Bioenergi 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 Gaussin and Glob Bioenergi into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Gaussin and Glob Bioenergi, you can compare the effects of market volatilities on Gaussin and Glob Bioenergi 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 Gaussin with a short position of Glob Bioenergi. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gaussin and Glob Bioenergi.
Diversification Opportunities for Gaussin and Glob Bioenergi
0.55 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Gaussin and Glob is 0.55. Overlapping area represents the amount of risk that can be diversified away by holding Gaussin and Glob Bioenergi in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Glob Bioenergi and Gaussin 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 Gaussin are associated (or correlated) with Glob Bioenergi. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Glob Bioenergi has no effect on the direction of Gaussin i.e., Gaussin and Glob Bioenergi go up and down completely randomly.
Pair Corralation between Gaussin and Glob Bioenergi
Assuming the 90 days trading horizon Gaussin is expected to generate 6.03 times more return on investment than Glob Bioenergi. However, Gaussin is 6.03 times more volatile than Glob Bioenergi. It trades about 0.09 of its potential returns per unit of risk. Glob Bioenergi is currently generating about 0.06 per unit of risk. If you would invest 12.00 in Gaussin on September 2, 2024 and sell it today you would lose (1.00) from holding Gaussin or give up 8.33% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Gaussin vs. Glob Bioenergi
Performance |
| Timeline |
| Gaussin |
| Glob Bioenergi |
Gaussin and Glob Bioenergi Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Gaussin and Glob Bioenergi
The main advantage of trading using opposite Gaussin and Glob Bioenergi positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gaussin position performs unexpectedly, Glob Bioenergi 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 Glob Bioenergi will offset losses from the drop in Glob Bioenergi's long position.| Gaussin vs. Europlasma SA | Gaussin vs. Novacyt | Gaussin vs. Drone Volt SA | Gaussin vs. Blockchain Group SA |
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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
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