Correlation Between Global E and Rogers
Can any of the company-specific risk be diversified away by investing in both Global E and Rogers 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 Global E and Rogers into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Global E Online and Rogers, you can compare the effects of market volatilities on Global E and Rogers 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 Global E with a short position of Rogers. Check out your portfolio center. Please also check ongoing floating volatility patterns of Global E and Rogers.
Diversification Opportunities for Global E and Rogers
Modest diversification
The 3 months correlation between Global and Rogers is 0.21. Overlapping area represents the amount of risk that can be diversified away by holding Global E Online and Rogers in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Rogers and Global E 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 Global E Online are associated (or correlated) with Rogers. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Rogers has no effect on the direction of Global E i.e., Global E and Rogers go up and down completely randomly.
Pair Corralation between Global E and Rogers
Given the investment horizon of 90 days Global E Online is expected to generate 1.75 times more return on investment than Rogers. However, Global E is 1.75 times more volatile than Rogers. It trades about 0.42 of its potential returns per unit of risk. Rogers is currently generating about 0.0 per unit of risk. If you would invest 4,020 in Global E Online on September 12, 2024 and sell it today you would earn a total of 1,332 from holding Global E Online or generate 33.13% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Global E Online vs. Rogers
Performance |
| Timeline |
| Global E Online |
| Rogers |
Global E and Rogers Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Global E and Rogers
The main advantage of trading using opposite Global E and Rogers positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Global E position performs unexpectedly, Rogers 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 Rogers will offset losses from the drop in Rogers' long position.| Global E vs. MercadoLibre | Global E vs. PDD Holdings | Global E vs. JD Inc Adr | Global E vs. Alibaba Group Holding |
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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
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