Correlation Between G2D Investments and Pettenati
Can any of the company-specific risk be diversified away by investing in both G2D Investments and Pettenati 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 G2D Investments and Pettenati into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between G2D Investments and Pettenati SA Industria, you can compare the effects of market volatilities on G2D Investments and Pettenati 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 G2D Investments with a short position of Pettenati. Check out your portfolio center. Please also check ongoing floating volatility patterns of G2D Investments and Pettenati.
Diversification Opportunities for G2D Investments and Pettenati
0.41 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between G2D and Pettenati is 0.41. Overlapping area represents the amount of risk that can be diversified away by holding G2D Investments and Pettenati SA Industria in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pettenati SA Industria and G2D Investments 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 G2D Investments are associated (or correlated) with Pettenati. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pettenati SA Industria has no effect on the direction of G2D Investments i.e., G2D Investments and Pettenati go up and down completely randomly.
Pair Corralation between G2D Investments and Pettenati
Assuming the 90 days trading horizon G2D Investments is expected to generate 1.04 times more return on investment than Pettenati. However, G2D Investments is 1.04 times more volatile than Pettenati SA Industria. It trades about -0.19 of its potential returns per unit of risk. Pettenati SA Industria is currently generating about -0.26 per unit of risk. If you would invest 219.00 in G2D Investments on September 12, 2024 and sell it today you would lose (17.00) from holding G2D Investments or give up 7.76% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.24% |
| Values | Daily Returns |
G2D Investments vs. Pettenati SA Industria
Performance |
| Timeline |
| G2D Investments |
| Pettenati SA Industria |
G2D Investments and Pettenati Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with G2D Investments and Pettenati
The main advantage of trading using opposite G2D Investments and Pettenati positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if G2D Investments position performs unexpectedly, Pettenati 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 Pettenati will offset losses from the drop in Pettenati's long position.| G2D Investments vs. Paycom Software | G2D Investments vs. United States Steel | G2D Investments vs. BIONTECH SE DRN | G2D Investments vs. Taiwan Semiconductor Manufacturing |
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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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
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