Correlation Between Globrands and LivePerson
Can any of the company-specific risk be diversified away by investing in both Globrands and LivePerson 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 Globrands and LivePerson into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Globrands Group and LivePerson, you can compare the effects of market volatilities on Globrands and LivePerson 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 Globrands with a short position of LivePerson. Check out your portfolio center. Please also check ongoing floating volatility patterns of Globrands and LivePerson.
Diversification Opportunities for Globrands and LivePerson
-0.66 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Globrands and LivePerson is -0.66. Overlapping area represents the amount of risk that can be diversified away by holding Globrands Group and LivePerson in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on LivePerson and Globrands 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 Globrands Group are associated (or correlated) with LivePerson. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of LivePerson has no effect on the direction of Globrands i.e., Globrands and LivePerson go up and down completely randomly.
Pair Corralation between Globrands and LivePerson
Assuming the 90 days trading horizon Globrands Group is expected to generate 0.1 times more return on investment than LivePerson. However, Globrands Group is 9.56 times less risky than LivePerson. It trades about 0.59 of its potential returns per unit of risk. LivePerson is currently generating about -0.13 per unit of risk. If you would invest 4,150,000 in Globrands Group on August 27, 2024 and sell it today you would earn a total of 344,000 from holding Globrands Group or generate 8.29% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Globrands Group vs. LivePerson
Performance |
| Timeline |
| Globrands Group |
| LivePerson |
Globrands and LivePerson Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Globrands and LivePerson
The main advantage of trading using opposite Globrands and LivePerson positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Globrands position performs unexpectedly, LivePerson 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 LivePerson will offset losses from the drop in LivePerson's long position.| Globrands vs. Diplomat Holdings | Globrands vs. Tiv Taam | Globrands vs. Victory Supermarket Chain | Globrands vs. Neto ME Holdings |
| LivePerson vs. Nova | LivePerson vs. Nice | LivePerson vs. Matrix | LivePerson vs. Magic Software Enterprises |
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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
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