Correlation Between GlaxoSmithKline PLC and 1inch
Can any of the company-specific risk be diversified away by investing in both GlaxoSmithKline PLC and 1inch 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 GlaxoSmithKline PLC and 1inch into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between GlaxoSmithKline PLC ADR and 1inch, you can compare the effects of market volatilities on GlaxoSmithKline PLC and 1inch 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 GlaxoSmithKline PLC with a short position of 1inch. Check out your portfolio center. Please also check ongoing floating volatility patterns of GlaxoSmithKline PLC and 1inch.
Diversification Opportunities for GlaxoSmithKline PLC and 1inch
-0.56 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between GlaxoSmithKline and 1inch is -0.56. Overlapping area represents the amount of risk that can be diversified away by holding GlaxoSmithKline PLC ADR and 1inch in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on 1inch and GlaxoSmithKline PLC 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 GlaxoSmithKline PLC ADR are associated (or correlated) with 1inch. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of 1inch has no effect on the direction of GlaxoSmithKline PLC i.e., GlaxoSmithKline PLC and 1inch go up and down completely randomly.
Pair Corralation between GlaxoSmithKline PLC and 1inch
Considering the 90-day investment horizon GlaxoSmithKline PLC is expected to generate 9.1 times less return on investment than 1inch. But when comparing it to its historical volatility, GlaxoSmithKline PLC ADR is 4.25 times less risky than 1inch. It trades about 0.01 of its potential returns per unit of risk. 1inch is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 44.00 in 1inch on August 30, 2024 and sell it today you would lose (1.00) from holding 1inch or give up 2.27% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 60.28% |
| Values | Daily Returns |
GlaxoSmithKline PLC ADR vs. 1inch
Performance |
| Timeline |
| GlaxoSmithKline PLC ADR |
| 1inch |
GlaxoSmithKline PLC and 1inch Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GlaxoSmithKline PLC and 1inch
The main advantage of trading using opposite GlaxoSmithKline PLC and 1inch positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GlaxoSmithKline PLC position performs unexpectedly, 1inch 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 1inch will offset losses from the drop in 1inch's long position.| GlaxoSmithKline PLC vs. Novartis AG ADR | GlaxoSmithKline PLC vs. AstraZeneca PLC ADR | GlaxoSmithKline PLC vs. Roche Holding Ltd | GlaxoSmithKline PLC vs. Bristol Myers Squibb |
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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
Other Complementary Tools
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine | |
| Portfolio Comparator Compare the composition, asset allocations and performance of any two portfolios in your account | |
| Top Crypto Exchanges Search and analyze digital assets across top global cryptocurrency exchanges | |
| AI Portfolio Architect Use AI to generate optimal portfolios and find profitable investment opportunities | |
| Idea Breakdown Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes |