Correlation Between Gunkul Engineering and Steel Public
Can any of the company-specific risk be diversified away by investing in both Gunkul Engineering and Steel Public 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 Gunkul Engineering and Steel Public into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Gunkul Engineering Public and The Steel Public, you can compare the effects of market volatilities on Gunkul Engineering and Steel Public 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 Gunkul Engineering with a short position of Steel Public. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gunkul Engineering and Steel Public.
Diversification Opportunities for Gunkul Engineering and Steel Public
0.38 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Gunkul and Steel is 0.38. Overlapping area represents the amount of risk that can be diversified away by holding Gunkul Engineering Public and The Steel Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Steel Public and Gunkul Engineering 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 Gunkul Engineering Public are associated (or correlated) with Steel Public. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Steel Public has no effect on the direction of Gunkul Engineering i.e., Gunkul Engineering and Steel Public go up and down completely randomly.
Pair Corralation between Gunkul Engineering and Steel Public
Assuming the 90 days trading horizon Gunkul Engineering Public is expected to under-perform the Steel Public. But the stock apears to be less risky and, when comparing its historical volatility, Gunkul Engineering Public is 20.79 times less risky than Steel Public. The stock trades about -0.06 of its potential returns per unit of risk. The The Steel Public is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 142.00 in The Steel Public on August 31, 2024 and sell it today you would lose (68.00) from holding The Steel Public or give up 47.89% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Gunkul Engineering Public vs. The Steel Public
Performance |
| Timeline |
| Gunkul Engineering Public |
| Steel Public |
Gunkul Engineering and Steel Public Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Gunkul Engineering and Steel Public
The main advantage of trading using opposite Gunkul Engineering and Steel Public positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gunkul Engineering position performs unexpectedly, Steel Public 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 Steel Public will offset losses from the drop in Steel Public's long position.| Gunkul Engineering vs. Gulf Energy Development | Gunkul Engineering vs. Energy Absolute Public | Gunkul Engineering vs. WHA Public | Gunkul Engineering vs. TRC Construction Public |
| Steel Public vs. Gulf Energy Development | Steel Public vs. Energy Absolute Public | Steel Public vs. WHA Public | Steel Public vs. TRC Construction Public |
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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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