Correlation Between Green Globe and Turning Point
Can any of the company-specific risk be diversified away by investing in both Green Globe and Turning Point 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 Turning Point 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 Turning Point Brands, you can compare the effects of market volatilities on Green Globe and Turning Point 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 Turning Point. Check out your portfolio center. Please also check ongoing floating volatility patterns of Green Globe and Turning Point.
Diversification Opportunities for Green Globe and Turning Point
-0.11 | Correlation Coefficient |
Good diversification
The 3 months correlation between Green and Turning is -0.11. Overlapping area represents the amount of risk that can be diversified away by holding Green Globe International and Turning Point Brands in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Turning Point Brands 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 Turning Point. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Turning Point Brands has no effect on the direction of Green Globe i.e., Green Globe and Turning Point go up and down completely randomly.
Pair Corralation between Green Globe and Turning Point
Given the investment horizon of 90 days Green Globe International is expected to generate 10.94 times more return on investment than Turning Point. However, Green Globe is 10.94 times more volatile than Turning Point Brands. It trades about 0.12 of its potential returns per unit of risk. Turning Point Brands is currently generating about 0.68 per unit of risk. If you would invest 0.04 in Green Globe International on August 24, 2024 and sell it today you would earn a total of 0.01 from holding Green Globe International or generate 25.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.65% |
| Values | Daily Returns |
Green Globe International vs. Turning Point Brands
Performance |
| Timeline |
| Green Globe International |
| Turning Point Brands |
Green Globe and Turning Point Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Green Globe and Turning Point
The main advantage of trading using opposite Green Globe and Turning Point positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Green Globe position performs unexpectedly, Turning Point 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 Turning Point will offset losses from the drop in Turning Point's long position.| Green Globe vs. Kaival Brands Innovations | Green Globe vs. Greenlane Holdings | Green Globe vs. RLX Technology | Green Globe vs. 22nd Century Group |
| Turning Point vs. Universal | Turning Point vs. Imperial Brands PLC | Turning Point vs. Philip Morris International | Turning Point vs. Japan Tobacco ADR |
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 Portfolio Dashboard module to portfolio dashboard that provides centralized access to all your investments.
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