Correlation Between GBS Software and LOANDEPOT INC
Can any of the company-specific risk be diversified away by investing in both GBS Software and LOANDEPOT INC 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 GBS Software and LOANDEPOT INC into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between GBS Software AG and LOANDEPOT INC A, you can compare the effects of market volatilities on GBS Software and LOANDEPOT INC 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 GBS Software with a short position of LOANDEPOT INC. Check out your portfolio center. Please also check ongoing floating volatility patterns of GBS Software and LOANDEPOT INC.
Diversification Opportunities for GBS Software and LOANDEPOT INC
-0.5 | Correlation Coefficient |
Very good diversification
The 3 months correlation between GBS and LOANDEPOT is -0.5. Overlapping area represents the amount of risk that can be diversified away by holding GBS Software AG and LOANDEPOT INC A in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on LOANDEPOT INC A and GBS Software 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 GBS Software AG are associated (or correlated) with LOANDEPOT INC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of LOANDEPOT INC A has no effect on the direction of GBS Software i.e., GBS Software and LOANDEPOT INC go up and down completely randomly.
Pair Corralation between GBS Software and LOANDEPOT INC
Assuming the 90 days trading horizon GBS Software AG is expected to generate 0.62 times more return on investment than LOANDEPOT INC. However, GBS Software AG is 1.61 times less risky than LOANDEPOT INC. It trades about 0.0 of its potential returns per unit of risk. LOANDEPOT INC A is currently generating about -0.1 per unit of risk. If you would invest 280.00 in GBS Software AG on November 7, 2024 and sell it today you would lose (2.00) from holding GBS Software AG or give up 0.71% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
GBS Software AG vs. LOANDEPOT INC A
Performance |
| Timeline |
| GBS Software AG |
| LOANDEPOT INC A |
GBS Software and LOANDEPOT INC Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GBS Software and LOANDEPOT INC
The main advantage of trading using opposite GBS Software and LOANDEPOT INC positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GBS Software position performs unexpectedly, LOANDEPOT INC 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 LOANDEPOT INC will offset losses from the drop in LOANDEPOT INC's long position.| GBS Software vs. SIVERS SEMICONDUCTORS AB | GBS Software vs. NorAm Drilling AS | GBS Software vs. Volkswagen AG | GBS Software vs. Darden Restaurants |
| LOANDEPOT INC vs. MARKET VECTR RETAIL | LOANDEPOT INC vs. MAVEN WIRELESS SWEDEN | LOANDEPOT INC vs. Mobilezone Holding AG | LOANDEPOT INC vs. Highlight Communications AG |
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 Portfolio Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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