Correlation Between Bankers Investment and G5 Entertainment
Can any of the company-specific risk be diversified away by investing in both Bankers Investment and G5 Entertainment 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 Bankers Investment and G5 Entertainment into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bankers Investment Trust and G5 Entertainment AB, you can compare the effects of market volatilities on Bankers Investment and G5 Entertainment 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 Bankers Investment with a short position of G5 Entertainment. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bankers Investment and G5 Entertainment.
Diversification Opportunities for Bankers Investment and G5 Entertainment
0.78 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Bankers and 0QUS is 0.78. Overlapping area represents the amount of risk that can be diversified away by holding Bankers Investment Trust and G5 Entertainment AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on G5 Entertainment and Bankers Investment 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 Bankers Investment Trust are associated (or correlated) with G5 Entertainment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of G5 Entertainment has no effect on the direction of Bankers Investment i.e., Bankers Investment and G5 Entertainment go up and down completely randomly.
Pair Corralation between Bankers Investment and G5 Entertainment
Assuming the 90 days trading horizon Bankers Investment is expected to generate 3.5 times less return on investment than G5 Entertainment. But when comparing it to its historical volatility, Bankers Investment Trust is 2.6 times less risky than G5 Entertainment. It trades about 0.17 of its potential returns per unit of risk. G5 Entertainment AB is currently generating about 0.23 of returns per unit of risk over similar time horizon. If you would invest 9,900 in G5 Entertainment AB on October 26, 2024 and sell it today you would earn a total of 2,020 from holding G5 Entertainment AB or generate 20.4% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bankers Investment Trust vs. G5 Entertainment AB
Performance |
| Timeline |
| Bankers Investment Trust |
| G5 Entertainment |
Bankers Investment and G5 Entertainment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bankers Investment and G5 Entertainment
The main advantage of trading using opposite Bankers Investment and G5 Entertainment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bankers Investment position performs unexpectedly, G5 Entertainment 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 G5 Entertainment will offset losses from the drop in G5 Entertainment's long position.| Bankers Investment vs. SupplyMe Capital PLC | Bankers Investment vs. Premier African Minerals | Bankers Investment vs. SANTANDER UK 8 | Bankers Investment vs. Tower Resources plc |
| G5 Entertainment vs. Empire Metals Limited | G5 Entertainment vs. Jupiter Fund Management | G5 Entertainment vs. Waste Management | G5 Entertainment vs. Dentsply Sirona |
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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