Correlation Between Global Blue and Toast
Can any of the company-specific risk be diversified away by investing in both Global Blue and Toast 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 Global Blue and Toast into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Global Blue Group and Toast Inc, you can compare the effects of market volatilities on Global Blue and Toast 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 Global Blue with a short position of Toast. Check out your portfolio center. Please also check ongoing floating volatility patterns of Global Blue and Toast.
Diversification Opportunities for Global Blue and Toast
0.51 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Global and Toast is 0.51. Overlapping area represents the amount of risk that can be diversified away by holding Global Blue Group and Toast Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Toast Inc and Global Blue 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 Global Blue Group are associated (or correlated) with Toast. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Toast Inc has no effect on the direction of Global Blue i.e., Global Blue and Toast go up and down completely randomly.
Pair Corralation between Global Blue and Toast
Allowing for the 90-day total investment horizon Global Blue is expected to generate 4.13 times less return on investment than Toast. But when comparing it to its historical volatility, Global Blue Group is 1.06 times less risky than Toast. It trades about 0.13 of its potential returns per unit of risk. Toast Inc is currently generating about 0.5 of returns per unit of risk over similar time horizon. If you would invest 2,949 in Toast Inc on August 26, 2024 and sell it today you would earn a total of 1,325 from holding Toast Inc or generate 44.93% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Global Blue Group vs. Toast Inc
Performance |
| Timeline |
| Global Blue Group |
| Toast Inc |
Global Blue and Toast Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Global Blue and Toast
The main advantage of trading using opposite Global Blue and Toast positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Global Blue position performs unexpectedly, Toast 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 Toast will offset losses from the drop in Toast's long position.| Global Blue vs. Evertec | Global Blue vs. Consensus Cloud Solutions | Global Blue vs. CSG Systems International | Global Blue vs. EverCommerce |
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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
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