Correlation Between GlaxoSmithKline PLC and First High
Can any of the company-specific risk be diversified away by investing in both GlaxoSmithKline PLC and First High 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 First High 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 First High School Education, you can compare the effects of market volatilities on GlaxoSmithKline PLC and First High 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 First High. Check out your portfolio center. Please also check ongoing floating volatility patterns of GlaxoSmithKline PLC and First High.
Diversification Opportunities for GlaxoSmithKline PLC and First High
0.47 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between GlaxoSmithKline and First is 0.47. Overlapping area represents the amount of risk that can be diversified away by holding GlaxoSmithKline PLC ADR and First High School Education in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on First High School 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 First High. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of First High School has no effect on the direction of GlaxoSmithKline PLC i.e., GlaxoSmithKline PLC and First High go up and down completely randomly.
Pair Corralation between GlaxoSmithKline PLC and First High
If you would invest 19.00 in First High School Education on August 24, 2024 and sell it today you would earn a total of 0.00 from holding First High School Education or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 4.35% |
| Values | Daily Returns |
GlaxoSmithKline PLC ADR vs. First High School Education
Performance |
| Timeline |
| GlaxoSmithKline PLC ADR |
| First High School |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
GlaxoSmithKline PLC and First High Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GlaxoSmithKline PLC and First High
The main advantage of trading using opposite GlaxoSmithKline PLC and First High positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GlaxoSmithKline PLC position performs unexpectedly, First High 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 First High will offset losses from the drop in First High'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 |
| First High vs. Gaotu Techedu DRC | First High vs. New Oriental Education | First High vs. Sunlands Technology Group | First High vs. Ihuman Inc |
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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
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