Correlation Between AP Moeller and GSE Systems
Can any of the company-specific risk be diversified away by investing in both AP Moeller and GSE Systems 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 AP Moeller and GSE Systems into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AP Moeller Maersk AS and GSE Systems, you can compare the effects of market volatilities on AP Moeller and GSE Systems 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 AP Moeller with a short position of GSE Systems. Check out your portfolio center. Please also check ongoing floating volatility patterns of AP Moeller and GSE Systems.
Diversification Opportunities for AP Moeller and GSE Systems
0.61 | Correlation Coefficient |
Poor diversification
The 3 months correlation between AMKBY and GSE is 0.61. Overlapping area represents the amount of risk that can be diversified away by holding AP Moeller Maersk AS and GSE Systems in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GSE Systems and AP Moeller 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 AP Moeller Maersk AS are associated (or correlated) with GSE Systems. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GSE Systems has no effect on the direction of AP Moeller i.e., AP Moeller and GSE Systems go up and down completely randomly.
Pair Corralation between AP Moeller and GSE Systems
If you would invest 767.00 in AP Moeller Maersk AS on September 13, 2024 and sell it today you would earn a total of 78.00 from holding AP Moeller Maersk AS or generate 10.17% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 4.76% |
| Values | Daily Returns |
AP Moeller Maersk AS vs. GSE Systems
Performance |
| Timeline |
| AP Moeller Maersk |
| GSE Systems |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Solid
AP Moeller and GSE Systems Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AP Moeller and GSE Systems
The main advantage of trading using opposite AP Moeller and GSE Systems positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AP Moeller position performs unexpectedly, GSE Systems 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 GSE Systems will offset losses from the drop in GSE Systems' long position.| AP Moeller vs. Hapag Lloyd Aktiengesellschaft | AP Moeller vs. Nippon Yusen Kabushiki | AP Moeller vs. COSCO SHIPPING Holdings | AP Moeller vs. AP Moeller |
| GSE Systems vs. LifeSpeak | GSE Systems vs. RenoWorks Software | GSE Systems vs. 01 Communique Laboratory | GSE Systems vs. RESAAS Services |
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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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