Correlation Between Green Globe and Beijing Gas
Can any of the company-specific risk be diversified away by investing in both Green Globe and Beijing Gas 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 Green Globe and Beijing Gas into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Green Globe International and Beijing Gas Blue, you can compare the effects of market volatilities on Green Globe and Beijing Gas 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 Green Globe with a short position of Beijing Gas. Check out your portfolio center. Please also check ongoing floating volatility patterns of Green Globe and Beijing Gas.
Diversification Opportunities for Green Globe and Beijing Gas
-0.46 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Green and Beijing is -0.46. Overlapping area represents the amount of risk that can be diversified away by holding Green Globe International and Beijing Gas Blue in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Beijing Gas Blue and Green Globe 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 Green Globe International are associated (or correlated) with Beijing Gas. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Beijing Gas Blue has no effect on the direction of Green Globe i.e., Green Globe and Beijing Gas go up and down completely randomly.
Pair Corralation between Green Globe and Beijing Gas
Given the investment horizon of 90 days Green Globe International is expected to generate 1.35 times more return on investment than Beijing Gas. However, Green Globe is 1.35 times more volatile than Beijing Gas Blue. It trades about 0.09 of its potential returns per unit of risk. Beijing Gas Blue is currently generating about -0.22 per unit of risk. If you would invest 0.04 in Green Globe International on August 28, 2024 and sell it today you would earn a total of 0.00 from holding Green Globe International or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Green Globe International vs. Beijing Gas Blue
Performance |
| Timeline |
| Green Globe International |
| Beijing Gas Blue |
Green Globe and Beijing Gas Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Green Globe and Beijing Gas
The main advantage of trading using opposite Green Globe and Beijing Gas positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Green Globe position performs unexpectedly, Beijing Gas 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 Beijing Gas will offset losses from the drop in Beijing Gas' long position.| Green Globe vs. Kaival Brands Innovations | Green Globe vs. Greenlane Holdings | Green Globe vs. RLX Technology | Green Globe vs. 22nd Century Group |
| Beijing Gas vs. ENN Energy Holdings | Beijing Gas vs. EverGen Infrastructure Corp | Beijing Gas vs. OPAL Fuels | Beijing Gas vs. Atmos Energy |
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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
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