Correlation Between GLG Life and Golden Agri-Resources
Can any of the company-specific risk be diversified away by investing in both GLG Life and Golden Agri-Resources 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 GLG Life and Golden Agri-Resources into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between GLG Life Tech and Golden Agri Resources, you can compare the effects of market volatilities on GLG Life and Golden Agri-Resources 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 GLG Life with a short position of Golden Agri-Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of GLG Life and Golden Agri-Resources.
Diversification Opportunities for GLG Life and Golden Agri-Resources
0.14 | Correlation Coefficient |
Average diversification
The 3 months correlation between GLG and Golden is 0.14. Overlapping area represents the amount of risk that can be diversified away by holding GLG Life Tech and Golden Agri Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Golden Agri Resources and GLG Life 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 GLG Life Tech are associated (or correlated) with Golden Agri-Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Golden Agri Resources has no effect on the direction of GLG Life i.e., GLG Life and Golden Agri-Resources go up and down completely randomly.
Pair Corralation between GLG Life and Golden Agri-Resources
If you would invest 19.00 in Golden Agri Resources on November 5, 2024 and sell it today you would earn a total of 4.00 from holding Golden Agri Resources or generate 21.05% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 0.31% |
| Values | Daily Returns |
GLG Life Tech vs. Golden Agri Resources
Performance |
| Timeline |
| GLG Life Tech |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Golden Agri Resources |
GLG Life and Golden Agri-Resources Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GLG Life and Golden Agri-Resources
The main advantage of trading using opposite GLG Life and Golden Agri-Resources positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GLG Life position performs unexpectedly, Golden Agri-Resources 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 Golden Agri-Resources will offset losses from the drop in Golden Agri-Resources' long position.| GLG Life vs. Golden Agri Resources | GLG Life vs. Edible Garden AG | GLG Life vs. Vital Farms | GLG Life vs. Local Bounti Corp |
| Golden Agri-Resources vs. Wilmar International | Golden Agri-Resources vs. SLC Agricola SA | Golden Agri-Resources vs. Brasilagro Adr | Golden Agri-Resources vs. Alico Inc |
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 Commodity Directory module to find actively traded commodities issued by global exchanges.
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