Correlation Between G Capital and Unimit Engineering
Can any of the company-specific risk be diversified away by investing in both G Capital and Unimit Engineering 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 G Capital and Unimit Engineering into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between G Capital Public and Unimit Engineering Public, you can compare the effects of market volatilities on G Capital and Unimit Engineering 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 G Capital with a short position of Unimit Engineering. Check out your portfolio center. Please also check ongoing floating volatility patterns of G Capital and Unimit Engineering.
Diversification Opportunities for G Capital and Unimit Engineering
0.74 | Correlation Coefficient |
Poor diversification
The 3 months correlation between GCAP and Unimit is 0.74. Overlapping area represents the amount of risk that can be diversified away by holding G Capital Public and Unimit Engineering Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Unimit Engineering Public and G Capital 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 G Capital Public are associated (or correlated) with Unimit Engineering. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Unimit Engineering Public has no effect on the direction of G Capital i.e., G Capital and Unimit Engineering go up and down completely randomly.
Pair Corralation between G Capital and Unimit Engineering
Assuming the 90 days trading horizon G Capital Public is expected to under-perform the Unimit Engineering. In addition to that, G Capital is 2.59 times more volatile than Unimit Engineering Public. It trades about -0.3 of its total potential returns per unit of risk. Unimit Engineering Public is currently generating about -0.08 per unit of volatility. If you would invest 140.00 in Unimit Engineering Public on September 12, 2024 and sell it today you would lose (11.00) from holding Unimit Engineering Public or give up 7.86% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
G Capital Public vs. Unimit Engineering Public
Performance |
| Timeline |
| G Capital Public |
| Unimit Engineering Public |
G Capital and Unimit Engineering Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with G Capital and Unimit Engineering
The main advantage of trading using opposite G Capital and Unimit Engineering positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if G Capital position performs unexpectedly, Unimit Engineering 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 Unimit Engineering will offset losses from the drop in Unimit Engineering's long position.| G Capital vs. East Coast Furnitech | G Capital vs. Filter Vision Public | G Capital vs. Cho Thavee Public | G Capital vs. Akkhie Prakarn Public |
| Unimit Engineering vs. Union Petrochemical Public | Unimit Engineering vs. Ubis Public | Unimit Engineering vs. Unique Mining Services | Unimit Engineering vs. Eureka Design Public |
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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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