Correlation Between GP Investments and Comcast
Can any of the company-specific risk be diversified away by investing in both GP Investments and Comcast 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 GP Investments and Comcast into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between GP Investments and Comcast, you can compare the effects of market volatilities on GP Investments and Comcast 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 GP Investments with a short position of Comcast. Check out your portfolio center. Please also check ongoing floating volatility patterns of GP Investments and Comcast.
Diversification Opportunities for GP Investments and Comcast
-0.47 | Correlation Coefficient |
Very good diversification
The 3 months correlation between GPIV33 and Comcast is -0.47. Overlapping area represents the amount of risk that can be diversified away by holding GP Investments and Comcast in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Comcast and GP Investments 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 GP Investments are associated (or correlated) with Comcast. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Comcast has no effect on the direction of GP Investments i.e., GP Investments and Comcast go up and down completely randomly.
Pair Corralation between GP Investments and Comcast
Assuming the 90 days trading horizon GP Investments is expected to generate 1.52 times more return on investment than Comcast. However, GP Investments is 1.52 times more volatile than Comcast. It trades about 0.04 of its potential returns per unit of risk. Comcast is currently generating about 0.04 per unit of risk. If you would invest 278.00 in GP Investments on September 3, 2024 and sell it today you would earn a total of 108.00 from holding GP Investments or generate 38.85% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 99.0% |
| Values | Daily Returns |
GP Investments vs. Comcast
Performance |
| Timeline |
| GP Investments |
| Comcast |
GP Investments and Comcast Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GP Investments and Comcast
The main advantage of trading using opposite GP Investments and Comcast positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GP Investments position performs unexpectedly, Comcast 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 Comcast will offset losses from the drop in Comcast's long position.| GP Investments vs. Bradespar SA | GP Investments vs. Hsi Malls Fundo | GP Investments vs. Fundo Investimento Imobiliario | GP Investments vs. Fras le SA |
| Comcast vs. Delta Air Lines | Comcast vs. Iron Mountain Incorporated | Comcast vs. Take Two Interactive Software | Comcast vs. Mitsubishi UFJ Financial |
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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
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