Correlation Between Gobarto SA and Lubelski Wegiel
Can any of the company-specific risk be diversified away by investing in both Gobarto SA and Lubelski Wegiel 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 Gobarto SA and Lubelski Wegiel into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Gobarto SA and Lubelski Wegiel Bogdanka, you can compare the effects of market volatilities on Gobarto SA and Lubelski Wegiel 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 Gobarto SA with a short position of Lubelski Wegiel. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gobarto SA and Lubelski Wegiel.
Diversification Opportunities for Gobarto SA and Lubelski Wegiel
0.28 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Gobarto and Lubelski is 0.28. Overlapping area represents the amount of risk that can be diversified away by holding Gobarto SA and Lubelski Wegiel Bogdanka in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lubelski Wegiel Bogdanka and Gobarto SA 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 Gobarto SA are associated (or correlated) with Lubelski Wegiel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lubelski Wegiel Bogdanka has no effect on the direction of Gobarto SA i.e., Gobarto SA and Lubelski Wegiel go up and down completely randomly.
Pair Corralation between Gobarto SA and Lubelski Wegiel
Assuming the 90 days trading horizon Gobarto SA is expected to generate 3.07 times less return on investment than Lubelski Wegiel. In addition to that, Gobarto SA is 1.33 times more volatile than Lubelski Wegiel Bogdanka. It trades about 0.03 of its total potential returns per unit of risk. Lubelski Wegiel Bogdanka is currently generating about 0.14 per unit of volatility. If you would invest 2,140 in Lubelski Wegiel Bogdanka on September 5, 2024 and sell it today you would earn a total of 150.00 from holding Lubelski Wegiel Bogdanka or generate 7.01% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
Gobarto SA vs. Lubelski Wegiel Bogdanka
Performance |
| Timeline |
| Gobarto SA |
| Lubelski Wegiel Bogdanka |
Gobarto SA and Lubelski Wegiel Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Gobarto SA and Lubelski Wegiel
The main advantage of trading using opposite Gobarto SA and Lubelski Wegiel positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gobarto SA position performs unexpectedly, Lubelski Wegiel 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 Lubelski Wegiel will offset losses from the drop in Lubelski Wegiel's long position.| Gobarto SA vs. Banco Santander SA | Gobarto SA vs. UniCredit SpA | Gobarto SA vs. CEZ as | Gobarto SA vs. Polski Koncern Naftowy |
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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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