Correlation Between GlaxoSmithKline PLC and Ivy Apollo
Can any of the company-specific risk be diversified away by investing in both GlaxoSmithKline PLC and Ivy Apollo 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 Ivy Apollo 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 Ivy Apollo Multi Asset, you can compare the effects of market volatilities on GlaxoSmithKline PLC and Ivy Apollo 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 Ivy Apollo. Check out your portfolio center. Please also check ongoing floating volatility patterns of GlaxoSmithKline PLC and Ivy Apollo.
Diversification Opportunities for GlaxoSmithKline PLC and Ivy Apollo
0.42 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between GlaxoSmithKline and Ivy is 0.42. Overlapping area represents the amount of risk that can be diversified away by holding GlaxoSmithKline PLC ADR and Ivy Apollo Multi Asset in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ivy Apollo Multi 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 Ivy Apollo. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ivy Apollo Multi has no effect on the direction of GlaxoSmithKline PLC i.e., GlaxoSmithKline PLC and Ivy Apollo go up and down completely randomly.
Pair Corralation between GlaxoSmithKline PLC and Ivy Apollo
Considering the 90-day investment horizon GlaxoSmithKline PLC is expected to generate 1.47 times less return on investment than Ivy Apollo. In addition to that, GlaxoSmithKline PLC is 1.97 times more volatile than Ivy Apollo Multi Asset. It trades about 0.01 of its total potential returns per unit of risk. Ivy Apollo Multi Asset is currently generating about 0.02 per unit of volatility. If you would invest 902.00 in Ivy Apollo Multi Asset on August 29, 2024 and sell it today you would earn a total of 64.00 from holding Ivy Apollo Multi Asset or generate 7.1% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
GlaxoSmithKline PLC ADR vs. Ivy Apollo Multi Asset
Performance |
| Timeline |
| GlaxoSmithKline PLC ADR |
| Ivy Apollo Multi |
GlaxoSmithKline PLC and Ivy Apollo Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GlaxoSmithKline PLC and Ivy Apollo
The main advantage of trading using opposite GlaxoSmithKline PLC and Ivy Apollo positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GlaxoSmithKline PLC position performs unexpectedly, Ivy Apollo 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 Ivy Apollo will offset losses from the drop in Ivy Apollo'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 |
| Ivy Apollo vs. Jennison Natural Resources | Ivy Apollo vs. Tortoise Energy Independence | Ivy Apollo vs. Calvert Global Energy | Ivy Apollo vs. Icon Natural Resources |
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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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