Correlation Between G J and Country Group
Can any of the company-specific risk be diversified away by investing in both G J and Country Group 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 G J and Country Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between G J Steel and Country Group Holdings, you can compare the effects of market volatilities on G J and Country Group 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 G J with a short position of Country Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of G J and Country Group.
Diversification Opportunities for G J and Country Group
0.65 | Correlation Coefficient |
Poor diversification
The 3 months correlation between GJS and Country is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding G J Steel and Country Group Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Country Group Holdings and G J 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 G J Steel are associated (or correlated) with Country Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Country Group Holdings has no effect on the direction of G J i.e., G J and Country Group go up and down completely randomly.
Pair Corralation between G J and Country Group
Assuming the 90 days trading horizon G J is expected to generate 1.01 times less return on investment than Country Group. In addition to that, G J is 1.0 times more volatile than Country Group Holdings. It trades about 0.04 of its total potential returns per unit of risk. Country Group Holdings is currently generating about 0.04 per unit of volatility. If you would invest 94.00 in Country Group Holdings on October 24, 2024 and sell it today you would lose (36.00) from holding Country Group Holdings or give up 38.3% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 99.79% |
| Values | Daily Returns |
G J Steel vs. Country Group Holdings
Performance |
| Timeline |
| G J Steel |
| Country Group Holdings |
G J and Country Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with G J and Country Group
The main advantage of trading using opposite G J and Country Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if G J position performs unexpectedly, Country Group 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 Country Group will offset losses from the drop in Country Group's long position.| G J vs. POSCO Thainox Public | G J vs. Aqua Public | G J vs. Better World Green | G J vs. Eternal Energy Public |
| Country Group vs. Asia Plus Group | Country Group vs. Globlex Holding Management | Country Group vs. Asia Green Energy | Country Group vs. Amanah Leasing Public |
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 Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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