Correlation Between House Of and GT Capital
Can any of the company-specific risk be diversified away by investing in both House Of and GT 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 House Of and GT Capital into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between House of Investments and GT Capital Holdings, you can compare the effects of market volatilities on House Of and GT 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 House Of with a short position of GT Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of House Of and GT Capital.
Diversification Opportunities for House Of and GT Capital
0.5 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between House and GTCAP is 0.5. Overlapping area represents the amount of risk that can be diversified away by holding House of Investments and GT Capital Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GT Capital Holdings and House Of 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 House of Investments are associated (or correlated) with GT Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GT Capital Holdings has no effect on the direction of House Of i.e., House Of and GT Capital go up and down completely randomly.
Pair Corralation between House Of and GT Capital
Assuming the 90 days trading horizon House of Investments is expected to generate 1.58 times more return on investment than GT Capital. However, House Of is 1.58 times more volatile than GT Capital Holdings. It trades about 0.03 of its potential returns per unit of risk. GT Capital Holdings is currently generating about -0.05 per unit of risk. If you would invest 326.00 in House of Investments on December 4, 2024 and sell it today you would earn a total of 16.00 from holding House of Investments or generate 4.91% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 35.0% |
| Values | Daily Returns |
House of Investments vs. GT Capital Holdings
Performance |
| Timeline |
| House of Investments |
Risk-Adjusted Performance
Very Weak
Weak | Strong |
| GT Capital Holdings |
House Of and GT Capital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with House Of and GT Capital
The main advantage of trading using opposite House Of and GT Capital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if House Of position performs unexpectedly, GT 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 GT Capital will offset losses from the drop in GT Capital's long position.| House Of vs. Converge Information Communications | House Of vs. Allhome Corp | House Of vs. Top Frontier Investment | House Of vs. Swift Foods |
| GT Capital vs. Atlas Consolidated Mining | GT Capital vs. Converge Information Communications | GT Capital vs. SM Investments Corp | GT Capital vs. Philex Mining Corp |
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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
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