Correlation Between GomSpace Group and Maha Energy
Can any of the company-specific risk be diversified away by investing in both GomSpace Group and Maha Energy 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 GomSpace Group and Maha Energy into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between GomSpace Group AB and Maha Energy AB, you can compare the effects of market volatilities on GomSpace Group and Maha Energy 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 GomSpace Group with a short position of Maha Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of GomSpace Group and Maha Energy.
Diversification Opportunities for GomSpace Group and Maha Energy
0.83 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between GomSpace and Maha is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding GomSpace Group AB and Maha Energy AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Maha Energy AB and GomSpace Group 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 GomSpace Group AB are associated (or correlated) with Maha Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Maha Energy AB has no effect on the direction of GomSpace Group i.e., GomSpace Group and Maha Energy go up and down completely randomly.
Pair Corralation between GomSpace Group and Maha Energy
Assuming the 90 days trading horizon GomSpace Group AB is expected to generate 2.4 times more return on investment than Maha Energy. However, GomSpace Group is 2.4 times more volatile than Maha Energy AB. It trades about 0.27 of its potential returns per unit of risk. Maha Energy AB is currently generating about 0.08 per unit of risk. If you would invest 377.00 in GomSpace Group AB on August 30, 2024 and sell it today you would earn a total of 80.00 from holding GomSpace Group AB or generate 21.22% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
GomSpace Group AB vs. Maha Energy AB
Performance |
| Timeline |
| GomSpace Group AB |
| Maha Energy AB |
GomSpace Group and Maha Energy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GomSpace Group and Maha Energy
The main advantage of trading using opposite GomSpace Group and Maha Energy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GomSpace Group position performs unexpectedly, Maha Energy 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 Maha Energy will offset losses from the drop in Maha Energy's long position.| GomSpace Group vs. Troax Group AB | GomSpace Group vs. NIBE Industrier AB | GomSpace Group vs. Hexatronic Group AB | GomSpace Group vs. Bufab Holding AB |
| Maha Energy vs. GomSpace Group AB | Maha Energy vs. SaltX Technology Holding | Maha Energy vs. Ambu AS | Maha Energy vs. Fingerprint Cards AB |
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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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