Correlation Between Caseys General and Gladstone Commercial
Can any of the company-specific risk be diversified away by investing in both Caseys General and Gladstone Commercial 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 Caseys General and Gladstone Commercial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Caseys General Stores and Gladstone Commercial, you can compare the effects of market volatilities on Caseys General and Gladstone Commercial 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 Caseys General with a short position of Gladstone Commercial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Caseys General and Gladstone Commercial.
Diversification Opportunities for Caseys General and Gladstone Commercial
0.26 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Caseys and Gladstone is 0.26. Overlapping area represents the amount of risk that can be diversified away by holding Caseys General Stores and Gladstone Commercial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gladstone Commercial and Caseys General 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 Caseys General Stores are associated (or correlated) with Gladstone Commercial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gladstone Commercial has no effect on the direction of Caseys General i.e., Caseys General and Gladstone Commercial go up and down completely randomly.
Pair Corralation between Caseys General and Gladstone Commercial
Assuming the 90 days trading horizon Caseys General Stores is expected to generate 0.57 times more return on investment than Gladstone Commercial. However, Caseys General Stores is 1.74 times less risky than Gladstone Commercial. It trades about 0.18 of its potential returns per unit of risk. Gladstone Commercial is currently generating about 0.05 per unit of risk. If you would invest 38,600 in Caseys General Stores on November 4, 2024 and sell it today you would earn a total of 1,800 from holding Caseys General Stores or generate 4.66% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Caseys General Stores vs. Gladstone Commercial
Performance |
| Timeline |
| Caseys General Stores |
| Gladstone Commercial |
Caseys General and Gladstone Commercial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Caseys General and Gladstone Commercial
The main advantage of trading using opposite Caseys General and Gladstone Commercial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Caseys General position performs unexpectedly, Gladstone Commercial 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 Gladstone Commercial will offset losses from the drop in Gladstone Commercial's long position.| Caseys General vs. PennantPark Investment | Caseys General vs. ANGANG STEEL H | Caseys General vs. Olympic Steel | Caseys General vs. CHRYSALIS INVESTMENTS LTD |
| Gladstone Commercial vs. PARKEN Sport Entertainment | Gladstone Commercial vs. Jacquet Metal Service | Gladstone Commercial vs. NorAm Drilling AS | Gladstone Commercial vs. COSMOSTEEL HLDGS |
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 Stocks Directory module to find actively traded stocks across global markets.
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