Correlation Between GBT Technologies and Dragon Capital
Can any of the company-specific risk be diversified away by investing in both GBT Technologies and Dragon Capital 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 GBT Technologies and Dragon Capital into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between GBT Technologies and Dragon Capital Grp, you can compare the effects of market volatilities on GBT Technologies and Dragon Capital 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 GBT Technologies with a short position of Dragon Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of GBT Technologies and Dragon Capital.
Diversification Opportunities for GBT Technologies and Dragon Capital
0.21 | Correlation Coefficient |
Modest diversification
The 3 months correlation between GBT and Dragon is 0.21. Overlapping area represents the amount of risk that can be diversified away by holding GBT Technologies and Dragon Capital Grp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dragon Capital Grp and GBT Technologies 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 GBT Technologies are associated (or correlated) with Dragon Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dragon Capital Grp has no effect on the direction of GBT Technologies i.e., GBT Technologies and Dragon Capital go up and down completely randomly.
Pair Corralation between GBT Technologies and Dragon Capital
Given the investment horizon of 90 days GBT Technologies is expected to generate 4.43 times more return on investment than Dragon Capital. However, GBT Technologies is 4.43 times more volatile than Dragon Capital Grp. It trades about 0.17 of its potential returns per unit of risk. Dragon Capital Grp is currently generating about 0.15 per unit of risk. If you would invest 0.01 in GBT Technologies on August 29, 2024 and sell it today you would lose (0.01) from holding GBT Technologies or give up 100.0% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
GBT Technologies vs. Dragon Capital Grp
Performance |
| Timeline |
| GBT Technologies |
| Dragon Capital Grp |
GBT Technologies and Dragon Capital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GBT Technologies and Dragon Capital
The main advantage of trading using opposite GBT Technologies and Dragon Capital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GBT Technologies position performs unexpectedly, Dragon Capital 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 Dragon Capital will offset losses from the drop in Dragon Capital's long position.| GBT Technologies vs. Accenture plc | GBT Technologies vs. International Business Machines | GBT Technologies vs. Infosys Ltd ADR | GBT Technologies vs. Fidelity National Information |
| Dragon Capital vs. Crypto Co | Dragon Capital vs. Global Develpmts | Dragon Capital vs. Parsons Corp | Dragon Capital vs. GBT Technologies |
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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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