Correlation Between FORMPIPE SOFTWARE and Graphic Packaging
Can any of the company-specific risk be diversified away by investing in both FORMPIPE SOFTWARE and Graphic Packaging 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 FORMPIPE SOFTWARE and Graphic Packaging into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between FORMPIPE SOFTWARE AB and Graphic Packaging Holding, you can compare the effects of market volatilities on FORMPIPE SOFTWARE and Graphic Packaging 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 FORMPIPE SOFTWARE with a short position of Graphic Packaging. Check out your portfolio center. Please also check ongoing floating volatility patterns of FORMPIPE SOFTWARE and Graphic Packaging.
Diversification Opportunities for FORMPIPE SOFTWARE and Graphic Packaging
0.09 | Correlation Coefficient |
Significant diversification
The 3 months correlation between FORMPIPE and Graphic is 0.09. Overlapping area represents the amount of risk that can be diversified away by holding FORMPIPE SOFTWARE AB and Graphic Packaging Holding in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Graphic Packaging Holding and FORMPIPE SOFTWARE 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 FORMPIPE SOFTWARE AB are associated (or correlated) with Graphic Packaging. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Graphic Packaging Holding has no effect on the direction of FORMPIPE SOFTWARE i.e., FORMPIPE SOFTWARE and Graphic Packaging go up and down completely randomly.
Pair Corralation between FORMPIPE SOFTWARE and Graphic Packaging
Assuming the 90 days horizon FORMPIPE SOFTWARE AB is expected to generate 2.47 times more return on investment than Graphic Packaging. However, FORMPIPE SOFTWARE is 2.47 times more volatile than Graphic Packaging Holding. It trades about 0.15 of its potential returns per unit of risk. Graphic Packaging Holding is currently generating about 0.1 per unit of risk. If you would invest 200.00 in FORMPIPE SOFTWARE AB on October 20, 2024 and sell it today you would earn a total of 18.00 from holding FORMPIPE SOFTWARE AB or generate 9.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 94.44% |
| Values | Daily Returns |
FORMPIPE SOFTWARE AB vs. Graphic Packaging Holding
Performance |
| Timeline |
| FORMPIPE SOFTWARE |
| Graphic Packaging Holding |
FORMPIPE SOFTWARE and Graphic Packaging Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with FORMPIPE SOFTWARE and Graphic Packaging
The main advantage of trading using opposite FORMPIPE SOFTWARE and Graphic Packaging positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if FORMPIPE SOFTWARE position performs unexpectedly, Graphic Packaging 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 Graphic Packaging will offset losses from the drop in Graphic Packaging's long position.| FORMPIPE SOFTWARE vs. Virtu Financial | FORMPIPE SOFTWARE vs. Unity Software | FORMPIPE SOFTWARE vs. Check Point Software | FORMPIPE SOFTWARE vs. Direct Line Insurance |
| Graphic Packaging vs. JD SPORTS FASH | Graphic Packaging vs. PLAYSTUDIOS A DL 0001 | Graphic Packaging vs. PLAYTIKA HOLDING DL 01 | Graphic Packaging vs. SIERRA METALS |
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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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