Correlation Between GX AI and Livetech
Can any of the company-specific risk be diversified away by investing in both GX AI and Livetech 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 GX AI and Livetech into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between GX AI TECH and Livetech da Bahia, you can compare the effects of market volatilities on GX AI and Livetech 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 GX AI with a short position of Livetech. Check out your portfolio center. Please also check ongoing floating volatility patterns of GX AI and Livetech.
Diversification Opportunities for GX AI and Livetech
Pay attention - limited upside
The 3 months correlation between BAIQ39 and Livetech is -0.96. Overlapping area represents the amount of risk that can be diversified away by holding GX AI TECH and Livetech da Bahia in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Livetech da Bahia and GX AI 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 GX AI TECH are associated (or correlated) with Livetech. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Livetech da Bahia has no effect on the direction of GX AI i.e., GX AI and Livetech go up and down completely randomly.
Pair Corralation between GX AI and Livetech
Assuming the 90 days trading horizon GX AI TECH is expected to generate 0.58 times more return on investment than Livetech. However, GX AI TECH is 1.71 times less risky than Livetech. It trades about 0.13 of its potential returns per unit of risk. Livetech da Bahia is currently generating about -0.07 per unit of risk. If you would invest 6,450 in GX AI TECH on September 19, 2024 and sell it today you would earn a total of 1,752 from holding GX AI TECH or generate 27.16% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 94.44% |
| Values | Daily Returns |
GX AI TECH vs. Livetech da Bahia
Performance |
| Timeline |
| GX AI TECH |
| Livetech da Bahia |
GX AI and Livetech Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GX AI and Livetech
The main advantage of trading using opposite GX AI and Livetech positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GX AI position performs unexpectedly, Livetech 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 Livetech will offset losses from the drop in Livetech's long position.| GX AI vs. GP Investments | GX AI vs. United States Steel | GX AI vs. Paycom Software | GX AI vs. MAHLE Metal Leve |
| Livetech vs. T Mobile | Livetech vs. Verizon Communications | Livetech vs. Vodafone Group Public | Livetech vs. Fundo Investimento Imobiliario |
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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
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