Correlation Between Guinness Atkinson and Firsthand Alternative
Can any of the company-specific risk be diversified away by investing in both Guinness Atkinson and Firsthand Alternative 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 Guinness Atkinson and Firsthand Alternative into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Guinness Atkinson Global and Firsthand Alternative Energy, you can compare the effects of market volatilities on Guinness Atkinson and Firsthand Alternative 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 Guinness Atkinson with a short position of Firsthand Alternative. Check out your portfolio center. Please also check ongoing floating volatility patterns of Guinness Atkinson and Firsthand Alternative.
Diversification Opportunities for Guinness Atkinson and Firsthand Alternative
0.36 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Guinness and Firsthand is 0.36. Overlapping area represents the amount of risk that can be diversified away by holding Guinness Atkinson Global and Firsthand Alternative Energy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Firsthand Alternative and Guinness Atkinson 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 Guinness Atkinson Global are associated (or correlated) with Firsthand Alternative. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Firsthand Alternative has no effect on the direction of Guinness Atkinson i.e., Guinness Atkinson and Firsthand Alternative go up and down completely randomly.
Pair Corralation between Guinness Atkinson and Firsthand Alternative
Assuming the 90 days horizon Guinness Atkinson Global is expected to generate 0.57 times more return on investment than Firsthand Alternative. However, Guinness Atkinson Global is 1.76 times less risky than Firsthand Alternative. It trades about 0.05 of its potential returns per unit of risk. Firsthand Alternative Energy is currently generating about -0.06 per unit of risk. If you would invest 2,418 in Guinness Atkinson Global on August 29, 2024 and sell it today you would earn a total of 20.00 from holding Guinness Atkinson Global or generate 0.83% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Guinness Atkinson Global vs. Firsthand Alternative Energy
Performance |
| Timeline |
| Guinness Atkinson Global |
| Firsthand Alternative |
Guinness Atkinson and Firsthand Alternative Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Guinness Atkinson and Firsthand Alternative
The main advantage of trading using opposite Guinness Atkinson and Firsthand Alternative positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Guinness Atkinson position performs unexpectedly, Firsthand Alternative 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 Firsthand Alternative will offset losses from the drop in Firsthand Alternative's long position.| Guinness Atkinson vs. HUMANA INC | Guinness Atkinson vs. Aquagold International | Guinness Atkinson vs. Barloworld Ltd ADR | Guinness Atkinson vs. Morningstar Unconstrained Allocation |
| Firsthand Alternative vs. Live Oak Health | Firsthand Alternative vs. HUMANA INC | Firsthand Alternative vs. Aquagold International | Firsthand Alternative vs. Barloworld Ltd ADR |
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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
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