Correlation Between Ihuman and GSR II
Can any of the company-specific risk be diversified away by investing in both Ihuman and GSR II 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 Ihuman and GSR II into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ihuman Inc and GSR II Meteora, you can compare the effects of market volatilities on Ihuman and GSR II 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 Ihuman with a short position of GSR II. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ihuman and GSR II.
Diversification Opportunities for Ihuman and GSR II
Weak diversification
The 3 months correlation between Ihuman and GSR is 0.3. Overlapping area represents the amount of risk that can be diversified away by holding Ihuman Inc and GSR II Meteora in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GSR II Meteora and Ihuman 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 Ihuman Inc are associated (or correlated) with GSR II. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GSR II Meteora has no effect on the direction of Ihuman i.e., Ihuman and GSR II go up and down completely randomly.
Pair Corralation between Ihuman and GSR II
Allowing for the 90-day total investment horizon Ihuman Inc is expected to generate 0.42 times more return on investment than GSR II. However, Ihuman Inc is 2.36 times less risky than GSR II. It trades about -0.03 of its potential returns per unit of risk. GSR II Meteora is currently generating about -0.26 per unit of risk. If you would invest 307.00 in Ihuman Inc on August 31, 2024 and sell it today you would lose (143.00) from holding Ihuman Inc or give up 46.58% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 9.64% |
| Values | Daily Returns |
Ihuman Inc vs. GSR II Meteora
Performance |
| Timeline |
| Ihuman Inc |
| GSR II Meteora |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Ihuman and GSR II Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ihuman and GSR II
The main advantage of trading using opposite Ihuman and GSR II positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ihuman position performs unexpectedly, GSR II 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 GSR II will offset losses from the drop in GSR II's long position.| Ihuman vs. Boqii Holding Limited | Ihuman vs. Lixiang Education Holding | Ihuman vs. Huize Holding | Ihuman vs. Kuke Music Holding |
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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
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