Correlation Between Glory Star and Whole Earth
Can any of the company-specific risk be diversified away by investing in both Glory Star and Whole Earth 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 Glory Star and Whole Earth into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Glory Star New and Whole Earth Brands, you can compare the effects of market volatilities on Glory Star and Whole Earth 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 Glory Star with a short position of Whole Earth. Check out your portfolio center. Please also check ongoing floating volatility patterns of Glory Star and Whole Earth.
Diversification Opportunities for Glory Star and Whole Earth
0.22 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Glory and Whole is 0.22. Overlapping area represents the amount of risk that can be diversified away by holding Glory Star New and Whole Earth Brands in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Whole Earth Brands and Glory Star 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 Glory Star New are associated (or correlated) with Whole Earth. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Whole Earth Brands has no effect on the direction of Glory Star i.e., Glory Star and Whole Earth go up and down completely randomly.
Pair Corralation between Glory Star and Whole Earth
If you would invest 0.00 in Glory Star New on August 29, 2024 and sell it today you would earn a total of 0.13 from holding Glory Star New or generate 9.223372036854776E16% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 0.0% |
| Values | Daily Returns |
Glory Star New vs. Whole Earth Brands
Performance |
| Timeline |
| Glory Star New |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Good
| Whole Earth Brands |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Glory Star and Whole Earth Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Glory Star and Whole Earth
The main advantage of trading using opposite Glory Star and Whole Earth positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Glory Star position performs unexpectedly, Whole Earth 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 Whole Earth will offset losses from the drop in Whole Earth's long position.The idea behind Glory Star New and Whole Earth Brands pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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