Correlation Between Intersport Polska and GI Group
Can any of the company-specific risk be diversified away by investing in both Intersport Polska and GI Group 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 Intersport Polska and GI Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Intersport Polska SA and GI Group Poland, you can compare the effects of market volatilities on Intersport Polska and GI Group 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 Intersport Polska with a short position of GI Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Intersport Polska and GI Group.
Diversification Opportunities for Intersport Polska and GI Group
-0.24 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Intersport and GIG is -0.24. Overlapping area represents the amount of risk that can be diversified away by holding Intersport Polska SA and GI Group Poland in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GI Group Poland and Intersport Polska 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 Intersport Polska SA are associated (or correlated) with GI Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GI Group Poland has no effect on the direction of Intersport Polska i.e., Intersport Polska and GI Group go up and down completely randomly.
Pair Corralation between Intersport Polska and GI Group
Assuming the 90 days trading horizon Intersport Polska SA is expected to generate 2.21 times more return on investment than GI Group. However, Intersport Polska is 2.21 times more volatile than GI Group Poland. It trades about 0.02 of its potential returns per unit of risk. GI Group Poland is currently generating about 0.01 per unit of risk. If you would invest 81.00 in Intersport Polska SA on September 12, 2024 and sell it today you would lose (9.00) from holding Intersport Polska SA or give up 11.11% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Intersport Polska SA vs. GI Group Poland
Performance |
| Timeline |
| Intersport Polska |
| GI Group Poland |
Intersport Polska and GI Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Intersport Polska and GI Group
The main advantage of trading using opposite Intersport Polska and GI Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Intersport Polska position performs unexpectedly, GI Group 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 GI Group will offset losses from the drop in GI Group's long position.| Intersport Polska vs. Asseco Business Solutions | Intersport Polska vs. Detalion Games SA | Intersport Polska vs. Asseco South Eastern | Intersport Polska vs. HM Inwest SA |
| GI Group vs. Intersport Polska SA | GI Group vs. Biztech Konsulting SA | GI Group vs. Quantum Software SA | GI Group vs. Play2Chill SA |
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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