Correlation Between Golden Haven and Alliance Select
Can any of the company-specific risk be diversified away by investing in both Golden Haven and Alliance Select 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 Haven and Alliance Select into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Golden Haven Memorial and Alliance Select Foods, you can compare the effects of market volatilities on Golden Haven and Alliance Select 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 Haven with a short position of Alliance Select. Check out your portfolio center. Please also check ongoing floating volatility patterns of Golden Haven and Alliance Select.
Diversification Opportunities for Golden Haven and Alliance Select
-0.69 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Golden and Alliance is -0.69. Overlapping area represents the amount of risk that can be diversified away by holding Golden Haven Memorial and Alliance Select Foods in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Alliance Select Foods and Golden Haven 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 Haven Memorial are associated (or correlated) with Alliance Select. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Alliance Select Foods has no effect on the direction of Golden Haven i.e., Golden Haven and Alliance Select go up and down completely randomly.
Pair Corralation between Golden Haven and Alliance Select
Assuming the 90 days trading horizon Golden Haven Memorial is expected to generate 0.49 times more return on investment than Alliance Select. However, Golden Haven Memorial is 2.06 times less risky than Alliance Select. It trades about 0.21 of its potential returns per unit of risk. Alliance Select Foods is currently generating about -0.01 per unit of risk. If you would invest 63,000 in Golden Haven Memorial on September 2, 2024 and sell it today you would earn a total of 157,000 from holding Golden Haven Memorial or generate 249.21% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 87.04% |
| Values | Daily Returns |
Golden Haven Memorial vs. Alliance Select Foods
Performance |
| Timeline |
| Golden Haven Memorial |
| Alliance Select Foods |
Golden Haven and Alliance Select Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Golden Haven and Alliance Select
The main advantage of trading using opposite Golden Haven and Alliance Select positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Golden Haven position performs unexpectedly, Alliance Select 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 Alliance Select will offset losses from the drop in Alliance Select's long position.| Golden Haven vs. Philippine Savings Bank | Golden Haven vs. Globe Telecom | Golden Haven vs. East West Banking | Golden Haven vs. Manila Mining Corp |
| Alliance Select vs. Bank of the | Alliance Select vs. Transpacific Broadband Group | Alliance Select vs. Premiere Entertainment | Alliance Select vs. Atlas Consolidated Mining |
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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
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