Correlation Between G5 Entertainment and Alfa Laval
Can any of the company-specific risk be diversified away by investing in both G5 Entertainment and Alfa Laval 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 G5 Entertainment and Alfa Laval into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between G5 Entertainment publ and Alfa Laval AB, you can compare the effects of market volatilities on G5 Entertainment and Alfa Laval 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 G5 Entertainment with a short position of Alfa Laval. Check out your portfolio center. Please also check ongoing floating volatility patterns of G5 Entertainment and Alfa Laval.
Diversification Opportunities for G5 Entertainment and Alfa Laval
-0.17 | Correlation Coefficient |
Good diversification
The 3 months correlation between G5EN and Alfa is -0.17. Overlapping area represents the amount of risk that can be diversified away by holding G5 Entertainment publ and Alfa Laval AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Alfa Laval AB and G5 Entertainment 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 G5 Entertainment publ are associated (or correlated) with Alfa Laval. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Alfa Laval AB has no effect on the direction of G5 Entertainment i.e., G5 Entertainment and Alfa Laval go up and down completely randomly.
Pair Corralation between G5 Entertainment and Alfa Laval
Assuming the 90 days trading horizon G5 Entertainment publ is expected to under-perform the Alfa Laval. In addition to that, G5 Entertainment is 1.61 times more volatile than Alfa Laval AB. It trades about -0.06 of its total potential returns per unit of risk. Alfa Laval AB is currently generating about 0.04 per unit of volatility. If you would invest 39,434 in Alfa Laval AB on August 31, 2024 and sell it today you would earn a total of 6,996 from holding Alfa Laval AB or generate 17.74% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
G5 Entertainment publ vs. Alfa Laval AB
Performance |
| Timeline |
| G5 Entertainment publ |
| Alfa Laval AB |
G5 Entertainment and Alfa Laval Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with G5 Entertainment and Alfa Laval
The main advantage of trading using opposite G5 Entertainment and Alfa Laval positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if G5 Entertainment position performs unexpectedly, Alfa Laval 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 Alfa Laval will offset losses from the drop in Alfa Laval's long position.| G5 Entertainment vs. Stillfront Group AB | G5 Entertainment vs. Paradox Interactive AB | G5 Entertainment vs. Catena Media plc | G5 Entertainment vs. Betsson AB |
| Alfa Laval vs. Samhllsbyggnadsbolaget i Norden | Alfa Laval vs. Sinch AB | Alfa Laval vs. Embracer Group AB | Alfa Laval vs. Evolution AB |
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 Portfolio Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
Other Complementary Tools
| Portfolio Comparator Compare the composition, asset allocations and performance of any two portfolios in your account | |
| Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios | |
| Portfolio Anywhere Track or share privately all of your investments from the convenience of any device | |
| Earnings Calls Check upcoming earnings announcements updated hourly across public exchanges | |
| Insider Screener Find insiders across different sectors to evaluate their impact on performance |