Correlation Between Getty Images and ALK Abell
Can any of the company-specific risk be diversified away by investing in both Getty Images and ALK Abell 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 Getty Images and ALK Abell into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Getty Images Holdings and ALK Abell AS, you can compare the effects of market volatilities on Getty Images and ALK Abell 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 Getty Images with a short position of ALK Abell. Check out your portfolio center. Please also check ongoing floating volatility patterns of Getty Images and ALK Abell.
Diversification Opportunities for Getty Images and ALK Abell
0.75 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Getty and ALK is 0.75. Overlapping area represents the amount of risk that can be diversified away by holding Getty Images Holdings and ALK Abell AS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ALK Abell AS and Getty Images 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 Getty Images Holdings are associated (or correlated) with ALK Abell. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ALK Abell AS has no effect on the direction of Getty Images i.e., Getty Images and ALK Abell go up and down completely randomly.
Pair Corralation between Getty Images and ALK Abell
Given the investment horizon of 90 days Getty Images Holdings is expected to generate 4.08 times more return on investment than ALK Abell. However, Getty Images is 4.08 times more volatile than ALK Abell AS. It trades about 0.03 of its potential returns per unit of risk. ALK Abell AS is currently generating about -0.19 per unit of risk. If you would invest 267.00 in Getty Images Holdings on October 14, 2024 and sell it today you would lose (4.00) from holding Getty Images Holdings or give up 1.5% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.0% |
| Values | Daily Returns |
Getty Images Holdings vs. ALK Abell AS
Performance |
| Timeline |
| Getty Images Holdings |
| ALK Abell AS |
Getty Images and ALK Abell Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Getty Images and ALK Abell
The main advantage of trading using opposite Getty Images and ALK Abell positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Getty Images position performs unexpectedly, ALK Abell 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 ALK Abell will offset losses from the drop in ALK Abell's long position.| Getty Images vs. Twilio Inc | Getty Images vs. Baidu Inc | Getty Images vs. Snap Inc | Getty Images vs. ANGI Homeservices |
| ALK Abell vs. CVR Partners LP | ALK Abell vs. Chemours Co | ALK Abell vs. Sensient Technologies | ALK Abell vs. Summit Materials |
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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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