Correlation Between GlaxoSmithKline PLC and Beta ETF
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By analyzing existing cross correlation between GlaxoSmithKline PLC ADR and Beta ETF WIG20Short, you can compare the effects of market volatilities on GlaxoSmithKline PLC and Beta ETF 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 Beta ETF. Check out your portfolio center. Please also check ongoing floating volatility patterns of GlaxoSmithKline PLC and Beta ETF.
Diversification Opportunities for GlaxoSmithKline PLC and Beta ETF
-0.78 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between GlaxoSmithKline and Beta is -0.78. Overlapping area represents the amount of risk that can be diversified away by holding GlaxoSmithKline PLC ADR and Beta ETF WIG20Short in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Beta ETF WIG20Short 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 Beta ETF. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Beta ETF WIG20Short has no effect on the direction of GlaxoSmithKline PLC i.e., GlaxoSmithKline PLC and Beta ETF go up and down completely randomly.
Pair Corralation between GlaxoSmithKline PLC and Beta ETF
Considering the 90-day investment horizon GlaxoSmithKline PLC ADR is expected to under-perform the Beta ETF. But the stock apears to be less risky and, when comparing its historical volatility, GlaxoSmithKline PLC ADR is 1.16 times less risky than Beta ETF. The stock trades about -0.31 of its potential returns per unit of risk. The Beta ETF WIG20Short is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 29,520 in Beta ETF WIG20Short on August 29, 2024 and sell it today you would earn a total of 800.00 from holding Beta ETF WIG20Short or generate 2.71% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 90.91% |
| Values | Daily Returns |
GlaxoSmithKline PLC ADR vs. Beta ETF WIG20Short
Performance |
| Timeline |
| GlaxoSmithKline PLC ADR |
| Beta ETF WIG20Short |
GlaxoSmithKline PLC and Beta ETF Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GlaxoSmithKline PLC and Beta ETF
The main advantage of trading using opposite GlaxoSmithKline PLC and Beta ETF positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GlaxoSmithKline PLC position performs unexpectedly, Beta ETF 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 Beta ETF will offset losses from the drop in Beta ETF'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 |
| Beta ETF vs. Asseco Business Solutions | Beta ETF vs. Detalion Games SA | Beta ETF vs. Asseco South Eastern | Beta ETF vs. CFI Holding SA |
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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
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