Correlation Between EBRO FOODS and GLG LIFE
Can any of the company-specific risk be diversified away by investing in both EBRO FOODS and GLG LIFE 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 EBRO FOODS and GLG LIFE into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between EBRO FOODS and GLG LIFE TECH, you can compare the effects of market volatilities on EBRO FOODS and GLG LIFE 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 EBRO FOODS with a short position of GLG LIFE. Check out your portfolio center. Please also check ongoing floating volatility patterns of EBRO FOODS and GLG LIFE.
Diversification Opportunities for EBRO FOODS and GLG LIFE
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between EBRO and GLG is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding EBRO FOODS and GLG LIFE TECH in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GLG LIFE TECH and EBRO FOODS 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 EBRO FOODS are associated (or correlated) with GLG LIFE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GLG LIFE TECH has no effect on the direction of EBRO FOODS i.e., EBRO FOODS and GLG LIFE go up and down completely randomly.
Pair Corralation between EBRO FOODS and GLG LIFE
If you would invest 1,546 in EBRO FOODS on November 3, 2024 and sell it today you would earn a total of 58.00 from holding EBRO FOODS or generate 3.75% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
EBRO FOODS vs. GLG LIFE TECH
Performance |
| Timeline |
| EBRO FOODS |
| GLG LIFE TECH |
EBRO FOODS and GLG LIFE Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with EBRO FOODS and GLG LIFE
The main advantage of trading using opposite EBRO FOODS and GLG LIFE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if EBRO FOODS position performs unexpectedly, GLG LIFE 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 GLG LIFE will offset losses from the drop in GLG LIFE's long position.| EBRO FOODS vs. INTERNET INJPADR 1 | EBRO FOODS vs. Zoom Video Communications | EBRO FOODS vs. Mitsui Chemicals | EBRO FOODS vs. Heidelberg Materials AG |
| GLG LIFE vs. UNITED UTILITIES GR | GLG LIFE vs. United Utilities Group | GLG LIFE vs. Chesapeake Utilities | GLG LIFE vs. MARKET VECTR RETAIL |
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 Portfolio Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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