Correlation Between International Business and GEO JS
Can any of the company-specific risk be diversified away by investing in both International Business 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 International Business and GEO JS into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between International Business Machines and GEO JS Tech, you can compare the effects of market volatilities on International Business 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 International Business with a short position of GEO JS. Check out your portfolio center. Please also check ongoing floating volatility patterns of International Business and GEO JS.
Diversification Opportunities for International Business and GEO JS
-0.46 | Correlation Coefficient |
Very good diversification
The 3 months correlation between International and GEO is -0.46. Overlapping area represents the amount of risk that can be diversified away by holding International Business Machine 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 International Business 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 International Business Machines 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 International Business i.e., International Business and GEO JS go up and down completely randomly.
Pair Corralation between International Business and GEO JS
Considering the 90-day investment horizon International Business is expected to generate 1.76 times less return on investment than GEO JS. But when comparing it to its historical volatility, International Business Machines is 9.39 times less risky than GEO JS. It trades about 0.12 of its potential returns per unit of risk. GEO JS Tech is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 0.84 in GEO JS Tech on September 14, 2024 and sell it today you would lose (0.54) from holding GEO JS Tech or give up 64.29% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
International Business Machine vs. GEO JS Tech
Performance |
| Timeline |
| International Business |
| GEO JS Tech |
International Business and GEO JS Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with International Business and GEO JS
The main advantage of trading using opposite International Business and GEO JS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if International Business 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.| International Business vs. EPAM Systems | International Business vs. Infosys Ltd ADR | International Business vs. Cognizant Technology Solutions | International Business vs. FiscalNote Holdings |
| 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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
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