Correlation Between Image Protect and Windfall Geotek
Can any of the company-specific risk be diversified away by investing in both Image Protect and Windfall Geotek 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 Image Protect and Windfall Geotek into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Image Protect and Windfall Geotek, you can compare the effects of market volatilities on Image Protect and Windfall Geotek 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 Image Protect with a short position of Windfall Geotek. Check out your portfolio center. Please also check ongoing floating volatility patterns of Image Protect and Windfall Geotek.
Diversification Opportunities for Image Protect and Windfall Geotek
0.09 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Image and Windfall is 0.09. Overlapping area represents the amount of risk that can be diversified away by holding Image Protect and Windfall Geotek in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Windfall Geotek and Image Protect 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 Image Protect are associated (or correlated) with Windfall Geotek. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Windfall Geotek has no effect on the direction of Image Protect i.e., Image Protect and Windfall Geotek go up and down completely randomly.
Pair Corralation between Image Protect and Windfall Geotek
Given the investment horizon of 90 days Image Protect is expected to generate 3.14 times more return on investment than Windfall Geotek. However, Image Protect is 3.14 times more volatile than Windfall Geotek. It trades about 0.12 of its potential returns per unit of risk. Windfall Geotek is currently generating about 0.09 per unit of risk. If you would invest 0.02 in Image Protect on September 12, 2024 and sell it today you would lose (0.01) from holding Image Protect or give up 50.0% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Image Protect vs. Windfall Geotek
Performance |
| Timeline |
| Image Protect |
| Windfall Geotek |
Image Protect and Windfall Geotek Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Image Protect and Windfall Geotek
The main advantage of trading using opposite Image Protect and Windfall Geotek positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Image Protect position performs unexpectedly, Windfall Geotek 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 Windfall Geotek will offset losses from the drop in Windfall Geotek's long position.| Image Protect vs. AB International Group | Image Protect vs. Bowmo Inc | Image Protect vs. Protek Capital | Image Protect vs. Ackroo Inc |
| Windfall Geotek vs. AB International Group | Windfall Geotek vs. Image Protect | Windfall Geotek vs. Bowmo Inc | Windfall Geotek vs. Protek Capital |
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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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