Correlation Between Global Service and II Group
Can any of the company-specific risk be diversified away by investing in both Global Service and II 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 Global Service and II Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Global Service Center and II Group Public, you can compare the effects of market volatilities on Global Service and II 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 Global Service with a short position of II Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Global Service and II Group.
Diversification Opportunities for Global Service and II Group
0.38 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Global and IIG is 0.38. Overlapping area represents the amount of risk that can be diversified away by holding Global Service Center and II Group Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on II Group Public and Global Service 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 Global Service Center are associated (or correlated) with II Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of II Group Public has no effect on the direction of Global Service i.e., Global Service and II Group go up and down completely randomly.
Pair Corralation between Global Service and II Group
Assuming the 90 days trading horizon Global Service Center is expected to under-perform the II Group. But the stock apears to be less risky and, when comparing its historical volatility, Global Service Center is 1.08 times less risky than II Group. The stock trades about -0.17 of its potential returns per unit of risk. The II Group Public is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 550.00 in II Group Public on September 12, 2024 and sell it today you would earn a total of 25.00 from holding II Group Public or generate 4.55% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 90.91% |
| Values | Daily Returns |
Global Service Center vs. II Group Public
Performance |
| Timeline |
| Global Service Center |
| II Group Public |
Global Service and II Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Global Service and II Group
The main advantage of trading using opposite Global Service and II Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Global Service position performs unexpectedly, II 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 II Group will offset losses from the drop in II Group's long position.| Global Service vs. Asphere Innovations Public | Global Service vs. Com7 PCL | Global Service vs. TKS Technologies Public | Global Service vs. Rajthanee Hospital Public |
| II Group vs. Delta Electronics Public | II Group vs. Delta Electronics Public | II Group vs. Airports of Thailand | II Group vs. Airports of Thailand |
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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
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