Correlation Between Global Electrical and South Books
Can any of the company-specific risk be diversified away by investing in both Global Electrical and South Books 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 Electrical and South Books into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Global Electrical Technology and South Books Educational, you can compare the effects of market volatilities on Global Electrical and South Books 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 Electrical with a short position of South Books. Check out your portfolio center. Please also check ongoing floating volatility patterns of Global Electrical and South Books.
Diversification Opportunities for Global Electrical and South Books
-0.54 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Global and South is -0.54. Overlapping area represents the amount of risk that can be diversified away by holding Global Electrical Technology and South Books Educational in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on South Books Educational and Global Electrical 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 Electrical Technology are associated (or correlated) with South Books. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of South Books Educational has no effect on the direction of Global Electrical i.e., Global Electrical and South Books go up and down completely randomly.
Pair Corralation between Global Electrical and South Books
Assuming the 90 days trading horizon Global Electrical Technology is expected to generate 0.51 times more return on investment than South Books. However, Global Electrical Technology is 1.97 times less risky than South Books. It trades about 0.27 of its potential returns per unit of risk. South Books Educational is currently generating about 0.0 per unit of risk. If you would invest 2,570,000 in Global Electrical Technology on October 20, 2024 and sell it today you would earn a total of 60,000 from holding Global Electrical Technology or generate 2.33% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 35.71% |
| Values | Daily Returns |
Global Electrical Technology vs. South Books Educational
Performance |
| Timeline |
| Global Electrical |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| South Books Educational |
Global Electrical and South Books Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Global Electrical and South Books
The main advantage of trading using opposite Global Electrical and South Books positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Global Electrical position performs unexpectedly, South Books 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 South Books will offset losses from the drop in South Books' long position.| Global Electrical vs. Tien Phong Plastic | Global Electrical vs. An Phat Holdings | Global Electrical vs. FPT Corp | Global Electrical vs. POST TELECOMMU |
| South Books vs. Tien Phong Plastic | South Books vs. An Phat Holdings | South Books vs. FPT Corp | South Books vs. POST TELECOMMU |
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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
Other Complementary Tools
| Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas | |
| Idea Breakdown Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes | |
| Fundamentals Comparison Compare fundamentals across multiple equities to find investing opportunities | |
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation | |
| Technical Analysis Check basic technical indicators and analysis based on most latest market data |