Correlation Between Home Depot and GEO JS
Can any of the company-specific risk be diversified away by investing in both Home Depot and GEO JS 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 Home Depot and GEO JS into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Home Depot and GEO JS Tech, you can compare the effects of market volatilities on Home Depot and GEO JS 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 Home Depot with a short position of GEO JS. Check out your portfolio center. Please also check ongoing floating volatility patterns of Home Depot and GEO JS.
Diversification Opportunities for Home Depot and GEO JS
-0.71 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Home and GEO is -0.71. Overlapping area represents the amount of risk that can be diversified away by holding Home Depot and GEO JS Tech in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GEO JS Tech and Home Depot 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 Home Depot are associated (or correlated) with GEO JS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GEO JS Tech has no effect on the direction of Home Depot i.e., Home Depot and GEO JS go up and down completely randomly.
Pair Corralation between Home Depot and GEO JS
Allowing for the 90-day total investment horizon Home Depot is expected to generate 0.24 times more return on investment than GEO JS. However, Home Depot is 4.12 times less risky than GEO JS. It trades about 0.07 of its potential returns per unit of risk. GEO JS Tech is currently generating about -0.16 per unit of risk. If you would invest 40,804 in Home Depot on September 14, 2024 and sell it today you would earn a total of 638.00 from holding Home Depot or generate 1.56% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
Home Depot vs. GEO JS Tech
Performance |
| Timeline |
| Home Depot |
| GEO JS Tech |
Home Depot and GEO JS Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Home Depot and GEO JS
The main advantage of trading using opposite Home Depot and GEO JS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Home Depot position performs unexpectedly, GEO JS 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 GEO JS will offset losses from the drop in GEO JS's long position.| Home Depot vs. Aquagold International | Home Depot vs. Thrivent High Yield | Home Depot vs. Morningstar Unconstrained Allocation | Home Depot vs. Via Renewables |
| GEO JS vs. Garibaldi Resources Corp | GEO JS vs. Northern Dynasty Minerals | GEO JS vs. Asia Broadband | GEO JS vs. Avarone Metals |
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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
Other Complementary Tools
| Stocks Directory Find actively traded stocks across global markets | |
| Price Transformation Use Price Transformation models to analyze the depth of different equity instruments across global markets | |
| Portfolio Manager State of the art Portfolio Manager to monitor and improve performance of your invested capital | |
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation | |
| Commodity Channel Use Commodity Channel Index to analyze current equity momentum |