Correlation Between GRIT Real and Pensionbee Group
Can any of the company-specific risk be diversified away by investing in both GRIT Real and Pensionbee Group 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 GRIT Real and Pensionbee Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between GRIT Real Estate and Pensionbee Group PLC, you can compare the effects of market volatilities on GRIT Real and Pensionbee Group 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 GRIT Real with a short position of Pensionbee Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of GRIT Real and Pensionbee Group.
Diversification Opportunities for GRIT Real and Pensionbee Group
0.8 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between GRIT and Pensionbee is 0.8. Overlapping area represents the amount of risk that can be diversified away by holding GRIT Real Estate and Pensionbee Group PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pensionbee Group PLC and GRIT Real 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 GRIT Real Estate are associated (or correlated) with Pensionbee Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pensionbee Group PLC has no effect on the direction of GRIT Real i.e., GRIT Real and Pensionbee Group go up and down completely randomly.
Pair Corralation between GRIT Real and Pensionbee Group
Assuming the 90 days trading horizon GRIT Real Estate is expected to under-perform the Pensionbee Group. But the stock apears to be less risky and, when comparing its historical volatility, GRIT Real Estate is 1.3 times less risky than Pensionbee Group. The stock trades about -0.07 of its potential returns per unit of risk. The Pensionbee Group PLC is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 5,410 in Pensionbee Group PLC on September 14, 2024 and sell it today you would earn a total of 10,340 from holding Pensionbee Group PLC or generate 191.13% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
GRIT Real Estate vs. Pensionbee Group PLC
Performance |
| Timeline |
| GRIT Real Estate |
| Pensionbee Group PLC |
GRIT Real and Pensionbee Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GRIT Real and Pensionbee Group
The main advantage of trading using opposite GRIT Real and Pensionbee Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GRIT Real position performs unexpectedly, Pensionbee Group 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 Pensionbee Group will offset losses from the drop in Pensionbee Group's long position.| GRIT Real vs. Derwent London PLC | GRIT Real vs. Hammerson PLC | GRIT Real vs. Workspace Group PLC | GRIT Real vs. Supermarket Income REIT |
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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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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