Correlation Between General Environmental and GMM Grammy
Can any of the company-specific risk be diversified away by investing in both General Environmental and GMM Grammy 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 General Environmental and GMM Grammy into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between General Environmental Conservation and GMM Grammy Public, you can compare the effects of market volatilities on General Environmental and GMM Grammy 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 General Environmental with a short position of GMM Grammy. Check out your portfolio center. Please also check ongoing floating volatility patterns of General Environmental and GMM Grammy.
Diversification Opportunities for General Environmental and GMM Grammy
0.27 | Correlation Coefficient |
Modest diversification
The 3 months correlation between General and GMM is 0.27. Overlapping area represents the amount of risk that can be diversified away by holding General Environmental Conserva and GMM Grammy Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GMM Grammy Public and General Environmental 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 General Environmental Conservation are associated (or correlated) with GMM Grammy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GMM Grammy Public has no effect on the direction of General Environmental i.e., General Environmental and GMM Grammy go up and down completely randomly.
Pair Corralation between General Environmental and GMM Grammy
Assuming the 90 days trading horizon General Environmental Conservation is expected to under-perform the GMM Grammy. In addition to that, General Environmental is 1.81 times more volatile than GMM Grammy Public. It trades about -0.09 of its total potential returns per unit of risk. GMM Grammy Public is currently generating about -0.08 per unit of volatility. If you would invest 825.00 in GMM Grammy Public on September 5, 2024 and sell it today you would lose (15.00) from holding GMM Grammy Public or give up 1.82% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
General Environmental Conserva vs. GMM Grammy Public
Performance |
| Timeline |
| General Environmental |
| GMM Grammy Public |
General Environmental and GMM Grammy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with General Environmental and GMM Grammy
The main advantage of trading using opposite General Environmental and GMM Grammy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if General Environmental position performs unexpectedly, GMM Grammy 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 GMM Grammy will offset losses from the drop in GMM Grammy's long position.| General Environmental vs. Asia Aviation Public | General Environmental vs. Bangkok Dusit Medical | General Environmental vs. Bangkok Expressway and | General Environmental vs. Airports of Thailand |
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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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
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