Correlation Between Impact Fusion and Glory Star
Can any of the company-specific risk be diversified away by investing in both Impact Fusion and Glory Star 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 Impact Fusion and Glory Star into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Impact Fusion International and Glory Star New, you can compare the effects of market volatilities on Impact Fusion and Glory Star 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 Impact Fusion with a short position of Glory Star. Check out your portfolio center. Please also check ongoing floating volatility patterns of Impact Fusion and Glory Star.
Diversification Opportunities for Impact Fusion and Glory Star
0.63 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Impact and Glory is 0.63. Overlapping area represents the amount of risk that can be diversified away by holding Impact Fusion International and Glory Star New in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Glory Star New and Impact Fusion 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 Impact Fusion International are associated (or correlated) with Glory Star. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Glory Star New has no effect on the direction of Impact Fusion i.e., Impact Fusion and Glory Star go up and down completely randomly.
Pair Corralation between Impact Fusion and Glory Star
Given the investment horizon of 90 days Impact Fusion International is expected to generate 0.18 times more return on investment than Glory Star. However, Impact Fusion International is 5.6 times less risky than Glory Star. It trades about 0.05 of its potential returns per unit of risk. Glory Star New is currently generating about 0.0 per unit of risk. If you would invest 6.17 in Impact Fusion International on August 28, 2024 and sell it today you would earn a total of 0.13 from holding Impact Fusion International or generate 2.11% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 61.9% |
| Values | Daily Returns |
Impact Fusion International vs. Glory Star New
Performance |
| Timeline |
| Impact Fusion Intern |
| Glory Star New |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Good
Impact Fusion and Glory Star Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Impact Fusion and Glory Star
The main advantage of trading using opposite Impact Fusion and Glory Star positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Impact Fusion position performs unexpectedly, Glory Star 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 Glory Star will offset losses from the drop in Glory Star's long position.| Impact Fusion vs. Digital Brand Media | Impact Fusion vs. Beyond Commerce | Impact Fusion vs. Baosheng Media Group | Impact Fusion vs. MGO Global Common |
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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