Correlation Between Global Business and Kubient
Can any of the company-specific risk be diversified away by investing in both Global Business and Kubient 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 Business and Kubient into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Global Business Travel and Kubient, you can compare the effects of market volatilities on Global Business and Kubient 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 Business with a short position of Kubient. Check out your portfolio center. Please also check ongoing floating volatility patterns of Global Business and Kubient.
Diversification Opportunities for Global Business and Kubient
-0.12 | Correlation Coefficient |
Good diversification
The 3 months correlation between Global and Kubient is -0.12. Overlapping area represents the amount of risk that can be diversified away by holding Global Business Travel and Kubient in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kubient and Global Business 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 Business Travel are associated (or correlated) with Kubient. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kubient has no effect on the direction of Global Business i.e., Global Business and Kubient go up and down completely randomly.
Pair Corralation between Global Business and Kubient
If you would invest 768.00 in Global Business Travel on August 27, 2024 and sell it today you would earn a total of 176.00 from holding Global Business Travel or generate 22.92% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 4.76% |
| Values | Daily Returns |
Global Business Travel vs. Kubient
Performance |
| Timeline |
| Global Business Travel |
| Kubient |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Global Business and Kubient Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Global Business and Kubient
The main advantage of trading using opposite Global Business and Kubient positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Global Business position performs unexpectedly, Kubient 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 Kubient will offset losses from the drop in Kubient's long position.The idea behind Global Business Travel and Kubient pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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