Correlation Between GWILLI FOOD and Makita
Can any of the company-specific risk be diversified away by investing in both GWILLI FOOD and Makita 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 GWILLI FOOD and Makita into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between GWILLI FOOD and Makita, you can compare the effects of market volatilities on GWILLI FOOD and Makita 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 GWILLI FOOD with a short position of Makita. Check out your portfolio center. Please also check ongoing floating volatility patterns of GWILLI FOOD and Makita.
Diversification Opportunities for GWILLI FOOD and Makita
0.06 | Correlation Coefficient |
Significant diversification
The 3 months correlation between GWILLI and Makita is 0.06. Overlapping area represents the amount of risk that can be diversified away by holding GWILLI FOOD and Makita in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Makita and GWILLI FOOD 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 GWILLI FOOD are associated (or correlated) with Makita. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Makita has no effect on the direction of GWILLI FOOD i.e., GWILLI FOOD and Makita go up and down completely randomly.
Pair Corralation between GWILLI FOOD and Makita
Assuming the 90 days trading horizon GWILLI FOOD is expected to generate 1.22 times more return on investment than Makita. However, GWILLI FOOD is 1.22 times more volatile than Makita. It trades about 0.18 of its potential returns per unit of risk. Makita is currently generating about -0.02 per unit of risk. If you would invest 985.00 in GWILLI FOOD on November 2, 2024 and sell it today you would earn a total of 565.00 from holding GWILLI FOOD or generate 57.36% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 99.04% |
| Values | Daily Returns |
GWILLI FOOD vs. Makita
Performance |
| Timeline |
| GWILLI FOOD |
| Makita |
GWILLI FOOD and Makita Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GWILLI FOOD and Makita
The main advantage of trading using opposite GWILLI FOOD and Makita positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GWILLI FOOD position performs unexpectedly, Makita 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 Makita will offset losses from the drop in Makita's long position.| GWILLI FOOD vs. Siamgas And Petrochemicals | GWILLI FOOD vs. CHEMICAL INDUSTRIES | GWILLI FOOD vs. American Airlines Group | GWILLI FOOD vs. Aegean Airlines SA |
| Makita vs. Superior Plus Corp | Makita vs. Origin Agritech | Makita vs. Identiv | Makita vs. INTUITIVE SURGICAL |
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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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