Correlation Between Getty Images and ChampionX
Can any of the company-specific risk be diversified away by investing in both Getty Images and ChampionX 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 ChampionX 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 ChampionX, you can compare the effects of market volatilities on Getty Images and ChampionX 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 ChampionX. Check out your portfolio center. Please also check ongoing floating volatility patterns of Getty Images and ChampionX.
Diversification Opportunities for Getty Images and ChampionX
-0.24 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Getty and ChampionX is -0.24. Overlapping area represents the amount of risk that can be diversified away by holding Getty Images Holdings and ChampionX in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ChampionX 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 ChampionX. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ChampionX has no effect on the direction of Getty Images i.e., Getty Images and ChampionX go up and down completely randomly.
Pair Corralation between Getty Images and ChampionX
Given the investment horizon of 90 days Getty Images Holdings is expected to under-perform the ChampionX. In addition to that, Getty Images is 1.97 times more volatile than ChampionX. It trades about -0.03 of its total potential returns per unit of risk. ChampionX is currently generating about 0.03 per unit of volatility. If you would invest 2,736 in ChampionX on September 1, 2024 and sell it today you would earn a total of 359.00 from holding ChampionX or generate 13.12% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Getty Images Holdings vs. ChampionX
Performance |
| Timeline |
| Getty Images Holdings |
| ChampionX |
Getty Images and ChampionX Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Getty Images and ChampionX
The main advantage of trading using opposite Getty Images and ChampionX positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Getty Images position performs unexpectedly, ChampionX 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 ChampionX will offset losses from the drop in ChampionX's long position.| Getty Images vs. MediaAlpha | Getty Images vs. Asset Entities Class | Getty Images vs. Yelp Inc | Getty Images vs. Shutterstock |
| ChampionX vs. Expro Group Holdings | ChampionX vs. Ranger Energy Services | ChampionX vs. Cactus Inc | ChampionX vs. MRC Global |
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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
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