Correlation Between Golden Ventures and Information
Can any of the company-specific risk be diversified away by investing in both Golden Ventures and Information 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 Golden Ventures and Information into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Golden Ventures Leasehold and Information and Communication, you can compare the effects of market volatilities on Golden Ventures and Information 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 Golden Ventures with a short position of Information. Check out your portfolio center. Please also check ongoing floating volatility patterns of Golden Ventures and Information.
Diversification Opportunities for Golden Ventures and Information
0.55 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Golden and Information is 0.55. Overlapping area represents the amount of risk that can be diversified away by holding Golden Ventures Leasehold and Information and Communication in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Information and Comm and Golden Ventures 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 Golden Ventures Leasehold are associated (or correlated) with Information. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Information and Comm has no effect on the direction of Golden Ventures i.e., Golden Ventures and Information go up and down completely randomly.
Pair Corralation between Golden Ventures and Information
Assuming the 90 days trading horizon Golden Ventures Leasehold is expected to generate 0.7 times more return on investment than Information. However, Golden Ventures Leasehold is 1.43 times less risky than Information. It trades about 0.0 of its potential returns per unit of risk. Information and Communication is currently generating about -0.03 per unit of risk. If you would invest 723.00 in Golden Ventures Leasehold on September 3, 2024 and sell it today you would lose (38.00) from holding Golden Ventures Leasehold or give up 5.26% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Golden Ventures Leasehold vs. Information and Communication
Performance |
| Timeline |
| Golden Ventures Leasehold |
| Information and Comm |
Golden Ventures and Information Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Golden Ventures and Information
The main advantage of trading using opposite Golden Ventures and Information positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Golden Ventures position performs unexpectedly, Information 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 Information will offset losses from the drop in Information's long position.| Golden Ventures vs. Impact Growth REIT | Golden Ventures vs. CPN Retail Growth | Golden Ventures vs. WHA Premium Growth | Golden Ventures vs. LH Shopping Centers |
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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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
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