Correlation Between Globe Trade and TEN SQUARE
Can any of the company-specific risk be diversified away by investing in both Globe Trade and TEN SQUARE 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 Globe Trade and TEN SQUARE into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Globe Trade Centre and TEN SQUARE GAMES, you can compare the effects of market volatilities on Globe Trade and TEN SQUARE 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 Globe Trade with a short position of TEN SQUARE. Check out your portfolio center. Please also check ongoing floating volatility patterns of Globe Trade and TEN SQUARE.
Diversification Opportunities for Globe Trade and TEN SQUARE
-0.59 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Globe and TEN is -0.59. Overlapping area represents the amount of risk that can be diversified away by holding Globe Trade Centre and TEN SQUARE GAMES in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TEN SQUARE GAMES and Globe Trade 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 Globe Trade Centre are associated (or correlated) with TEN SQUARE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TEN SQUARE GAMES has no effect on the direction of Globe Trade i.e., Globe Trade and TEN SQUARE go up and down completely randomly.
Pair Corralation between Globe Trade and TEN SQUARE
Assuming the 90 days trading horizon Globe Trade Centre is expected to under-perform the TEN SQUARE. But the stock apears to be less risky and, when comparing its historical volatility, Globe Trade Centre is 1.81 times less risky than TEN SQUARE. The stock trades about -0.27 of its potential returns per unit of risk. The TEN SQUARE GAMES is currently generating about -0.02 of returns per unit of risk over similar time horizon. If you would invest 7,950 in TEN SQUARE GAMES on September 2, 2024 and sell it today you would lose (130.00) from holding TEN SQUARE GAMES or give up 1.64% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Globe Trade Centre vs. TEN SQUARE GAMES
Performance |
| Timeline |
| Globe Trade Centre |
| TEN SQUARE GAMES |
Globe Trade and TEN SQUARE Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Globe Trade and TEN SQUARE
The main advantage of trading using opposite Globe Trade and TEN SQUARE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Globe Trade position performs unexpectedly, TEN SQUARE 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 TEN SQUARE will offset losses from the drop in TEN SQUARE's long position.The idea behind Globe Trade Centre and TEN SQUARE GAMES 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.| TEN SQUARE vs. Medicalg | TEN SQUARE vs. GreenX Metals | TEN SQUARE vs. Saule Technologies SA | TEN SQUARE vs. Echo Investment 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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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