Correlation Between WINMARK and TOTAL GABON
Can any of the company-specific risk be diversified away by investing in both WINMARK and TOTAL GABON 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 WINMARK and TOTAL GABON into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between WINMARK and TOTAL GABON, you can compare the effects of market volatilities on WINMARK and TOTAL GABON 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 WINMARK with a short position of TOTAL GABON. Check out your portfolio center. Please also check ongoing floating volatility patterns of WINMARK and TOTAL GABON.
Diversification Opportunities for WINMARK and TOTAL GABON
0.45 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between WINMARK and TOTAL is 0.45. Overlapping area represents the amount of risk that can be diversified away by holding WINMARK and TOTAL GABON in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TOTAL GABON and WINMARK 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 WINMARK are associated (or correlated) with TOTAL GABON. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TOTAL GABON has no effect on the direction of WINMARK i.e., WINMARK and TOTAL GABON go up and down completely randomly.
Pair Corralation between WINMARK and TOTAL GABON
Assuming the 90 days trading horizon WINMARK is expected to generate 19.94 times less return on investment than TOTAL GABON. In addition to that, WINMARK is 1.1 times more volatile than TOTAL GABON. It trades about 0.0 of its total potential returns per unit of risk. TOTAL GABON is currently generating about 0.08 per unit of volatility. If you would invest 13,706 in TOTAL GABON on September 7, 2024 and sell it today you would earn a total of 4,794 from holding TOTAL GABON or generate 34.98% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 99.6% |
| Values | Daily Returns |
WINMARK vs. TOTAL GABON
Performance |
| Timeline |
| WINMARK |
| TOTAL GABON |
WINMARK and TOTAL GABON Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with WINMARK and TOTAL GABON
The main advantage of trading using opposite WINMARK and TOTAL GABON positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if WINMARK position performs unexpectedly, TOTAL GABON 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 TOTAL GABON will offset losses from the drop in TOTAL GABON's long position.| WINMARK vs. Luckin Coffee | WINMARK vs. Grand Canyon Education | WINMARK vs. Corporate Office Properties | WINMARK vs. TAL Education Group |
| TOTAL GABON vs. CDN IMPERIAL BANK | TOTAL GABON vs. ATRESMEDIA | TOTAL GABON vs. Dave Busters Entertainment | TOTAL GABON vs. Hollywood Bowl Group |
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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
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