Correlation Between GelStat Corp and Galexxy Holdings
Can any of the company-specific risk be diversified away by investing in both GelStat Corp and Galexxy Holdings 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 GelStat Corp and Galexxy Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between GelStat Corp and Galexxy Holdings, you can compare the effects of market volatilities on GelStat Corp and Galexxy Holdings 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 GelStat Corp with a short position of Galexxy Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of GelStat Corp and Galexxy Holdings.
Diversification Opportunities for GelStat Corp and Galexxy Holdings
0.47 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between GelStat and Galexxy is 0.47. Overlapping area represents the amount of risk that can be diversified away by holding GelStat Corp and Galexxy Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Galexxy Holdings and GelStat Corp 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 GelStat Corp are associated (or correlated) with Galexxy Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Galexxy Holdings has no effect on the direction of GelStat Corp i.e., GelStat Corp and Galexxy Holdings go up and down completely randomly.
Pair Corralation between GelStat Corp and Galexxy Holdings
Given the investment horizon of 90 days GelStat Corp is expected to generate 1.12 times more return on investment than Galexxy Holdings. However, GelStat Corp is 1.12 times more volatile than Galexxy Holdings. It trades about 0.07 of its potential returns per unit of risk. Galexxy Holdings is currently generating about 0.03 per unit of risk. If you would invest 0.09 in GelStat Corp on November 19, 2024 and sell it today you would lose (0.05) from holding GelStat Corp or give up 55.56% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 96.18% |
| Values | Daily Returns |
GelStat Corp vs. Galexxy Holdings
Performance |
| Timeline |
| GelStat Corp |
| Galexxy Holdings |
GelStat Corp and Galexxy Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GelStat Corp and Galexxy Holdings
The main advantage of trading using opposite GelStat Corp and Galexxy Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GelStat Corp position performs unexpectedly, Galexxy Holdings 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 Galexxy Holdings will offset losses from the drop in Galexxy Holdings' long position.| GelStat Corp vs. Rimrock Gold Corp | GelStat Corp vs. Emergent Health Corp | GelStat Corp vs. Galexxy Holdings | GelStat Corp vs. Cann American Corp |
| Galexxy Holdings vs. Genesis Electronics Group | Galexxy Holdings vs. Nextmart | Galexxy Holdings vs. Emergent Health Corp | Galexxy Holdings vs. Goff Corp |
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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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